MB FINANCIAL, INC. | ||||
(Exact name of registrant as specified in its charter) | ||||
Maryland | 001-36599 | 36-4460265 | ||
(State or other jurisdiction of incorporation) | (Commission File No.) | (IRS Employer Identification No.) | ||
800 West Madison Street, Chicago, Illinois 60607 | ||||
(Address of principal executive offices) (Zip Code) | ||||
Registrant’s telephone number, including area code: (888) 422-6562 | ||||
N/A | ||||
(Former name or former address, if changed since last report) | ||||
MB FINANCIAL, INC. | ||||
Date: | October 22, 2018 | By: | /s/Randall T. Conte | |
Randall T. Conte | ||||
Vice President and Chief Financial Officer | ||||
(Principal Financial Officer) |
![]() | 3Q18 |
Operating Earnings (in thousands, except per share data) |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Net income - as reported | $ | 42,714 | $ | 38,533 | $ | 56,757 | $ | 144,194 | $ | 60,843 | $ | 138,004 | $ | 159,846 | |||||||||||||||
Non-core items, net of tax (1) | 12,889 | 18,679 | 614 | (96,814 | ) | 1,942 | 32,182 | 3,876 | |||||||||||||||||||||
Operating earnings | 55,603 | 57,212 | 57,371 | 47,380 | 62,785 | 170,186 | 163,722 | ||||||||||||||||||||||
Operating earnings (loss) - Mortgage Banking Segment | 1,067 | (3,359 | ) | (295 | ) | (815 | ) | 2,217 | (2,587 | ) | 6,309 | ||||||||||||||||||
Operating earnings, excluding Mortgage Banking Segment | 54,536 | 60,571 | 57,666 | 48,195 | 60,568 | 172,773 | 157,413 | ||||||||||||||||||||||
Dividends on preferred shares | 3,000 | 3,000 | 3,100 | 2,000 | 2,002 | 9,100 | 6,007 | ||||||||||||||||||||||
Operating earnings available to common stockholders, excluding Mortgage Banking Segment | $ | 51,536 | $ | 57,571 | $ | 54,566 | $ | 46,195 | $ | 58,566 | $ | 163,673 | $ | 151,406 | |||||||||||||||
Diluted earnings per common share - as reported (2) (3) | $ | 0.47 | $ | 0.42 | $ | 0.81 | $ | 1.67 | $ | 0.69 | $ | 1.69 | $ | 1.81 | |||||||||||||||
Diluted operating earnings per common share, excluding Mortgage Banking Segment | $ | 0.60 | $ | 0.68 | $ | 0.64 | $ | 0.54 | $ | 0.69 | $ | 1.92 | $ | 1.79 |
(1) | Non-core items represent the difference between non-core non-interest income and non-core non-interest expense net of tax as well as other non-core tax items. See "Non-GAAP Financial Information" section for details on non-core items starting on page 25. Non-core items for the third quarter of 2018 include approximately $7 million, net of tax, related to the discontinuation of our national mortgage origination business and approximately $3 million, net of tax, related to the pending merger with Fifth Third Bancorp ("Fifth Third"). Non-core items for the second quarter of 2018 include approximately $14 million, net of tax, related to the discontinuation of our national mortgage origination business and approximately $5 million, net of tax, related to the pending merger with Fifth Third. |
(2) | The $0.81 diluted earnings per common share in the first quarter of 2018 were positively impacted by a $15.3 million, or $0.18 per common share, return from preferred stockholders due to the redemption of our 8% Series A non-cumulative perpetual preferred stock. The $15.3 million represents the excess carrying amount over the redemption price of the Series A preferred stock. |
(3) | The $1.67 diluted earnings per common share in the fourth quarter of 2017 were positively impacted by a $104.2 million, or $1.23 per common share, tax benefit due to the enactment of the Tax Cuts and Jobs Act of 2017 (the "TCJ Act"). |
Key Items (compared to 2Q18) |
Pending Merger |
Operating Earnings |
• | Operating earnings, excluding the Mortgage Banking Segment, decreased $6.0 million, or 10.0%, to $54.5 million compared to the prior quarter. This decrease resulted from a $11.2 million (net of tax) increase in provision for credit losses (due to one loan relationship) partly offset by a $3.8 million (net of tax) increase in net interest income and a $2.5 million (net of tax) decrease in professional and legal fees. |
• | Diluted operating earnings per common share, excluding the Mortgage Banking Segment, were $0.60 compared to $0.68 in the prior quarter. |
Loans |
• | Loan balances, excluding purchased credit-impaired loans, increased $124.6 million (+0.9%, or +3.6%, annualized) from prior quarter end due to growth in commercial loans and a $75.5 million transfer from loans held for sale. |
• | Average loan balances, excluding purchased credit-impaired loans, decreased $6.4 million (-0.1%, or -0.2% annualized) to $13.7 billion. |
• | Average yield on loans, excluding accretion on loans acquired in bank mergers, increased 18 basis points to 4.68% from 4.50% in the prior quarter as a result of increases in short-term interest rates. |
Deposits |
• | Low-cost deposits decreased $136.6 million (-1.1%, or -4.3% annualized) from prior quarter end to $12.3 billion due to a decrease in non-interest bearing deposits (temporary decrease) partly offset by an increase in money market and NOW deposits. |
• | Average low-cost deposits increased $131.2 million (+1.0%, or +4.2% annualized) to $12.6 billion due to an increase in money market deposits. |
• | Average cost of total deposits increased seven basis points to 0.54%. |
Net interest margin |
• | Net interest margin on a fully tax equivalent basis, excluding accretion on loans acquired in bank mergers, increased eight basis points in the quarter to 3.70%. This increase was due to higher loan yields partly offset by increased funding costs. |
• | Average interest earning assets decreased $204.6 million mostly due to the decrease in loans held for sale as a result of the national mortgage origination wind down. |
• | Average cost of funds increased five basis points to 0.72% due to higher rates paid on interest bearing liabilities. |
Operating Segments (compared to 2Q18) |
Banking |
• | Operating earnings were $47.4 million, a decrease of $6.2 million, or 11.6%, compared to the prior quarter. |
• | This decrease was due to an increase in provision for credit losses (due to one loan relationship) partly offset by an increase in net interest income (higher average loan yields and lower borrowings) and a decrease in professional and legal fees. |
Leasing |
• | Operating earnings were $7.1 million, an increase of $172 thousand, or 2.5%, compared to the prior quarter. |
Mortgage Banking |
• | On April 12, 2018, we announced the discontinuation of our national mortgage origination business, which includes substantially all originations outside of the Company's consumer banking footprint in the Chicagoland area. |
• | Operating earnings were $1.1 million compared to an operating loss of $3.4 million in the prior quarter. |
• | The wind down of our national mortgage origination business is proceeding as planned. We project that, excluding any impact of our pending merger with Fifth Third, our remaining mortgage operations will earn quarterly pretax income of approximately $7.4 million in 2019, consistent with prior projections. |
Key Items (compared to nine months ended September 30, 2017) |
• | Operating earnings, excluding the Mortgage Banking Segment, increased $15.4 million, or 9.8%, to $172.8 million compared to the nine months ended September 30, 2017. |
• | The growth in operating earnings resulted from the following items (net of tax): a $20.8 million increase in net interest income, a $9.0 million increase in our key fee initiatives revenue (mainly lease financing revenue), a $4.2 million increase in earnings from investments in Small Business Investment Companies, and an approximate $16 million decrease in income tax expense (lower effective tax rate). These items were partly offset by a $20.7 million increase in non-interest expense with more than half of the increase in salaries and benefits (due to annual salary increases, new hires, and higher health insurance costs) and a $13.6 million increase in provision for credit losses (mostly recognized in the third quarter of 2018). |
• | Diluted operating earnings per common share, excluding the Mortgage Banking Segment, were $1.92 compared to $1.79 in the nine months ended September 30, 2017. |
Guidance on Selected Financial Items |
Operating Segments |
Banking Segment |
Nine Months Ended | ||||||||||||||||||||||||||||
September 30, | ||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | ||||||||||||||||||||||
Net interest income | $ | 152,003 | $ | 146,614 | $ | 140,471 | $ | 140,180 | $ | 142,888 | $ | 439,088 | $ | 410,319 | ||||||||||||||
Provision for credit losses | 21,439 | 5,746 | 7,579 | 501 | 3,637 | 34,764 | 16,054 | |||||||||||||||||||||
Net interest income after provision for credit losses | 130,564 | 140,868 | 132,892 | 139,679 | 139,251 | 404,324 | 394,265 | |||||||||||||||||||||
Non-interest income: | ||||||||||||||||||||||||||||
Lease financing revenue, net | 3,420 | 2,165 | 1,535 | 1,795 | 1,097 | 7,120 | 3,968 | |||||||||||||||||||||
Treasury management fees | 15,226 | 15,066 | 15,156 | 15,234 | 14,508 | 45,448 | 43,696 | |||||||||||||||||||||
Wealth management fees | 9,089 | 8,969 | 9,121 | 9,024 | 8,702 | 27,179 | 25,720 | |||||||||||||||||||||
Card fees | 5,362 | 5,654 | 4,787 | 5,032 | 4,585 | 15,803 | 13,564 | |||||||||||||||||||||
Capital markets and international banking fees | 1,913 | 3,785 | 2,998 | 3,999 | 4,870 | 8,696 | 11,709 | |||||||||||||||||||||
Other non-interest income | 10,987 | 11,838 | 10,675 | 9,359 | 10,940 | 33,500 | 29,901 | |||||||||||||||||||||
Total non-interest income | 45,997 | 47,477 | 44,272 | 44,443 | 44,702 | 137,746 | 128,558 | |||||||||||||||||||||
Non-interest expense: | ||||||||||||||||||||||||||||
Salaries and employee benefits expense: | ||||||||||||||||||||||||||||
Salaries | 44,933 | 45,103 | 44,821 | 44,782 | 45,096 | 134,857 | 131,235 | |||||||||||||||||||||
Commissions | 1,097 | 941 | 953 | 1,119 | 877 | 2,991 | 3,105 | |||||||||||||||||||||
Bonus and stock-based compensation | 10,774 | 11,533 | 10,610 | 10,418 | 10,032 | 32,917 | 31,254 | |||||||||||||||||||||
Other salaries and benefits (1) | 17,339 | 15,721 | 15,207 | 14,119 | 14,604 | 48,267 | 41,007 | |||||||||||||||||||||
Total salaries and employee benefits expense | 74,143 | 73,298 | 71,591 | 70,438 | 70,609 | 219,032 | 206,601 | |||||||||||||||||||||
Occupancy and equipment expense | 13,400 | 13,308 | 14,089 | 13,769 | 12,372 | 40,797 | 36,787 | |||||||||||||||||||||
Computer services and telecommunication expense | 8,324 | 9,384 | 9,741 | 9,664 | 8,386 | 27,449 | 23,876 | |||||||||||||||||||||
Professional and legal expense | 1,347 | 4,846 | 1,359 | 1,967 | 1,239 | 7,552 | 4,294 | |||||||||||||||||||||
Other operating expenses | 18,479 | 18,665 | 16,745 | 18,817 | 16,757 | 53,889 | 53,805 | |||||||||||||||||||||
Total non-interest expense | 115,693 | 119,501 | 113,525 | 114,655 | 109,363 | 348,719 | 325,363 | |||||||||||||||||||||
Income before income taxes | 60,868 | 68,844 | 63,639 | 69,467 | 74,590 | 193,351 | 197,460 | |||||||||||||||||||||
Income tax expense | 13,468 | 15,237 | 14,539 | 25,734 | 20,064 | 43,244 | 56,147 | |||||||||||||||||||||
Operating earnings | $ | 47,400 | $ | 53,607 | $ | 49,100 | $ | 43,733 | $ | 54,526 | $ | 150,107 | $ | 141,313 | ||||||||||||||
Total assets (period end) | $ | 16,677,552 | $ | 16,581,205 | $ | 16,582,585 | $ | 16,448,960 | $ | 16,406,714 | $ | 16,677,552 | $ | 16,406,714 |
(1) | Includes health insurance, payroll taxes, 401(k) and profit sharing contributions, overtime, and temporary help expenses. |
• | Net interest income increased due to higher average loan yields and reduced borrowings partly offset by a higher cost of funds. Our average yield on loans and cost of funds increased as a result of an increase in short-term rates. |
• | Provision for credit losses increased as a result of higher charge offs during the quarter due to one loan relationship. |
• | Lease financing revenue, net, increased due to higher earnings from investments in leasing companies and residual gains. |
• | Capital markets and international banking fees decreased due to lower swap fees and foreign currency derivative income. |
• | Other non-interest income decreased due to lower earnings from investments in Small Business Investment Companies. |
• | Salaries and benefits expense increased as a result of higher health insurance costs due to an increase in claims. |
• | Professional and legal fees decreased as the prior quarter was impacted by higher case settlements and other legal and professional fees. |
• | Net interest income increased due to higher average loan yields and balances partly offset by higher cost of funds. Our average yield on loans and cost of funds increased as a result of an increase in short-term rates. |
• | Provision for credit losses increased as a result of higher charge offs during the third quarter of 2018 due to one loan relationship. |
• | Non-interest income increased due to higher card fees (increased sales and volume in prepaid cards and higher credit card usage), higher lease financing revenue, net (higher earnings from investments in leasing companies and residual gains), and stronger earnings from Small Business Investment Companies. |
• | Non-interest expense increased as a result of higher salaries and employee benefits expense, occupancy and equipment expense (higher building and software depreciation), computer services and telecommunication expense (previous investments in new technology), and professional and legal fees (case settlements and other legal and professional fees). Salaries and employee benefits expense increased due to annual salary increases, new hires, higher health insurance costs, and higher bonus and stock based compensation expense. |
• | Income tax expense decreased as a result of a decline in the effective tax rate. |
Leasing Segment |
Nine Months Ended | ||||||||||||||||||||||||||||
September 30, | ||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | ||||||||||||||||||||||
Net interest income | $ | 2,160 | $ | 2,349 | $ | 2,482 | $ | 2,602 | $ | 2,686 | $ | 6,991 | $ | 7,300 | ||||||||||||||
Provision for credit losses | 90 | 500 | (24 | ) | 3,184 | 399 | 566 | 674 | ||||||||||||||||||||
Net interest income after provision for credit losses | 2,070 | 1,849 | 2,506 | (582 | ) | 2,287 | 6,425 | 6,626 | ||||||||||||||||||||
Non-interest income: | ||||||||||||||||||||||||||||
Lease financing revenue, net | 21,810 | 21,435 | 23,938 | 22,576 | 22,534 | 67,183 | 60,261 | |||||||||||||||||||||
Other non-interest income | 1,304 | 1,160 | 899 | 1,168 | 26 | 3,363 | 1,875 | |||||||||||||||||||||
Total non-interest income | 23,114 | 22,595 | 24,837 | 23,744 | 22,560 | 70,546 | 62,136 | |||||||||||||||||||||
Non-interest expense: | ||||||||||||||||||||||||||||
Salaries and employee benefits expense: | ||||||||||||||||||||||||||||
Salaries | 5,926 | 6,021 | 5,917 | 5,361 | 5,029 | 17,864 | 14,462 | |||||||||||||||||||||
Commissions | 2,662 | 1,892 | 2,520 | 2,777 | 2,328 | 7,074 | 7,015 | |||||||||||||||||||||
Bonus and stock-based compensation | 1,207 | 1,205 | 974 | 1,761 | 1,228 | 3,386 | 3,228 | |||||||||||||||||||||
Other salaries and benefits (1) | 1,338 | 1,613 | 1,809 | 1,329 | 1,572 | 4,760 | 4,676 | |||||||||||||||||||||
Total salaries and employee benefits expense | 11,133 | 10,731 | 11,220 | 11,228 | 10,157 | 33,084 | 29,381 | |||||||||||||||||||||
Occupancy and equipment expense | 1,128 | 1,110 | 1,167 | 1,090 | 1,070 | 3,405 | 3,025 | |||||||||||||||||||||
Computer services and telecommunication expense | 474 | 492 | 505 | 595 | 456 | 1,471 | 1,345 | |||||||||||||||||||||
Professional and legal expense | 353 | 323 | 373 | 457 | 403 | 1,049 | 1,194 | |||||||||||||||||||||
Other operating expenses | 2,480 | 2,500 | 2,212 | 2,101 | 2,412 | 7,192 | 6,766 | |||||||||||||||||||||
Total non-interest expense | 15,568 | 15,156 | 15,477 | 15,471 | 14,498 | 46,201 | 41,711 | |||||||||||||||||||||
Income before income taxes | 9,616 | 9,288 | 11,866 | 7,691 | 10,349 | 30,770 | 27,051 | |||||||||||||||||||||
Income tax expense | 2,480 | 2,324 | 3,300 | 3,229 | 4,307 | 8,104 | 10,951 | |||||||||||||||||||||
Operating earnings | $ | 7,136 | $ | 6,964 | $ | 8,566 | $ | 4,462 | $ | 6,042 | $ | 22,666 | $ | 16,100 | ||||||||||||||
Total assets (period end) | $ | 1,340,901 | $ | 1,354,940 | $ | 1,360,117 | $ | 1,403,690 | $ | 1,307,459 | $ | 1,340,901 | $ | 1,307,459 |
(1) | Includes health insurance, payroll taxes, 401(k) and profit sharing contributions, overtime, and temporary help expenses. |
• | Lease financing revenue, net, increased slightly due to higher fees from sales of third-party equipment maintenance contracts, promotional income, and syndication fees partly offset by lower residual gains. |
• | Non-interest expense increased slightly due to an increase in commissions expense resulting from increased sales of third-party equipment maintenance contracts in the quarter. |
Mortgage Banking Segment |
Nine Months Ended | ||||||||||||||||||||||||||||
September 30, | ||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | ||||||||||||||||||||||
Net interest income | $ | 7,685 | $ | 10,106 | $ | 10,428 | $ | 10,611 | $ | 11,373 | $ | 28,219 | $ | 31,365 | ||||||||||||||
Provision for credit losses | (26 | ) | (27 | ) | (47 | ) | (42 | ) | 481 | (100 | ) | 1,222 | ||||||||||||||||
Net interest income after provision for credit losses | 7,711 | 10,133 | 10,475 | 10,653 | 10,892 | 28,319 | 30,143 | |||||||||||||||||||||
Non-interest income: | ||||||||||||||||||||||||||||
Mortgage origination revenue | 1,907 | 13,334 | 17,854 | 18,146 | 22,647 | 33,095 | 68,725 | |||||||||||||||||||||
Mortgage servicing revenue | 8,009 | 5,592 | 7,193 | 4,228 | 5,595 | 20,794 | 18,125 | |||||||||||||||||||||
Other non-interest income | 13 | 11 | 1 | — | 1 | 25 | 1 | |||||||||||||||||||||
Total non-interest income | 9,929 | 18,937 | 25,048 | 22,374 | 28,243 | 53,914 | 86,851 | |||||||||||||||||||||
Non-interest expense: | ||||||||||||||||||||||||||||
Salaries and employee benefits expense: | ||||||||||||||||||||||||||||
Salaries | 5,375 | 12,033 | 13,849 | 12,322 | 11,867 | 31,257 | 34,995 | |||||||||||||||||||||
Commissions | 1,189 | 4,790 | 3,962 | 4,407 | 6,001 | 9,941 | 17,427 | |||||||||||||||||||||
Bonus and stock-based compensation | 392 | 115 | 471 | 1,153 | 651 | 978 | 2,272 | |||||||||||||||||||||
Other salaries and benefits (1) | 2,149 | 4,539 | 4,924 | 4,705 | 4,746 | 11,612 | 14,676 | |||||||||||||||||||||
Total salaries and employee benefits expense | 9,105 | 21,477 | 23,206 | 22,587 | 23,265 | 53,788 | 69,370 | |||||||||||||||||||||
Occupancy and equipment expense | 1,273 | 2,032 | 2,138 | 1,868 | 1,940 | 5,443 | 5,888 | |||||||||||||||||||||
Computer services and telecommunication expense | 1,263 | 1,677 | 1,673 | 1,779 | 1,734 | 4,613 | 5,098 | |||||||||||||||||||||
Professional and legal expense | 174 | 266 | 162 | 490 | 467 | 602 | 1,662 | |||||||||||||||||||||
Other operating expenses | 4,368 | 8,159 | 8,749 | 7,673 | 8,043 | 21,276 | 24,497 | |||||||||||||||||||||
Total non-interest expense | 16,183 | 33,611 | 35,928 | 34,397 | 35,449 | 85,722 | 106,515 | |||||||||||||||||||||
Income (loss) before income taxes | 1,457 | (4,541 | ) | (405 | ) | (1,370 | ) | 3,686 | (3,489 | ) | 10,479 | |||||||||||||||||
Income tax expense (benefit) | 390 | (1,182 | ) | (110 | ) | (555 | ) | 1,469 | (902 | ) | 4,170 | |||||||||||||||||
Operating earnings (loss) | $ | 1,067 | $ | (3,359 | ) | $ | (295 | ) | $ | (815 | ) | $ | 2,217 | $ | (2,587 | ) | $ | 6,309 | ||||||||||
Total assets (period end) (2) | $ | 1,701,518 | $ | 2,030,412 | $ | 2,224,821 | $ | 2,234,290 | $ | 2,402,362 | $ | 1,701,518 | $ | 2,402,362 |
(1) | Includes health insurance, payroll taxes, 401(k) and profit sharing contributions, overtime, and temporary help expenses. |
(2) | The decrease in total assets from June 30, 2018 to September 30, 2018 was due to the decrease in loans held for sale as a result of the wind down of the national mortgage origination business. |
Additional Mortgage Banking Segment Data |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Mortgage origination revenue: | |||||||||||||||||||||||||||||
Gain on sale revenue, net | $ | 1,303 | $ | 9,756 | $ | 11,652 | $ | 13,376 | $ | 17,098 | $ | 22,711 | $ | 50,705 | |||||||||||||||
Origination fees (1) | 604 | 3,578 | 6,202 | 4,770 | 5,549 | 10,384 | 18,020 | ||||||||||||||||||||||
Total mortgage origination revenue | $ | 1,907 | $ | 13,334 | $ | 17,854 | $ | 18,146 | $ | 22,647 | $ | 33,095 | $ | 68,725 | |||||||||||||||
Mortgage servicing revenue: | |||||||||||||||||||||||||||||
Servicing fees | $ | 15,953 | $ | 15,707 | $ | 16,068 | $ | 14,802 | $ | 14,531 | $ | 47,728 | $ | 42,331 | |||||||||||||||
Amortization/prepayment of mortgage servicing rights (2) | (8,418 | ) | (8,894 | ) | (8,015 | ) | (9,037 | ) | (8,399 | ) | (25,327 | ) | (22,964 | ) | |||||||||||||||
Fair value changes of mortgage servicing rights | 2,521 | 1,193 | 10,890 | 7,231 | 4,475 | 14,604 | 2,363 | ||||||||||||||||||||||
Economic hedge activity, net | (2,047 | ) | (2,414 | ) | (11,750 | ) | (8,768 | ) | (5,012 | ) | (16,211 | ) | (3,605 | ) | |||||||||||||||
Fair value changes of mortgage servicing rights net of economic hedge activity (3) | 474 | (1,221 | ) | (860 | ) | (1,537 | ) | (537 | ) | (1,607 | ) | (1,242 | ) | ||||||||||||||||
Total mortgage servicing revenue | $ | 8,009 | $ | 5,592 | $ | 7,193 | $ | 4,228 | $ | 5,595 | $ | 20,794 | $ | 18,125 | |||||||||||||||
Mortgage servicing rights, at fair value: | |||||||||||||||||||||||||||||
Beginning balance | $ | 296,629 | $ | 291,561 | $ | 276,279 | $ | 261,446 | $ | 249,688 | $ | 276,279 | $ | 238,011 | |||||||||||||||
Originations/purchases | 5,071 | 12,769 | 12,407 | 16,639 | 15,682 | 30,247 | 44,036 | ||||||||||||||||||||||
Amortization/prepayment (2) | (8,418 | ) | (8,894 | ) | (8,015 | ) | (9,037 | ) | (8,399 | ) | (25,327 | ) | (22,964 | ) | |||||||||||||||
Fair value changes | 2,521 | 1,193 | 10,890 | 7,231 | 4,475 | 14,604 | 2,363 | ||||||||||||||||||||||
Ending balance | $ | 295,803 | $ | 296,629 | $ | 291,561 | $ | 276,279 | $ | 261,446 | $ | 295,803 | $ | 261,446 | |||||||||||||||
Mortgage servicing book (unpaid principal balance of loans serviced for others) | $ | 22,382,822 | $ | 22,643,179 | $ | 22,362,896 | $ | 21,993,128 | $ | 21,380,397 | $ | 22,382,822 | $ | 21,380,397 | |||||||||||||||
Mortgage servicing rights valuation | 1.32 | % | 1.31 | % | 1.30 | % | 1.26 | % | 1.22 | % | 1.32 | % | 1.22 | % |
(1) | 2017 amounts were revised as certain costs to originate mortgage loans were reclassified from mortgage origination revenue to other operating expenses. |
(2) | Changes due to collection or realization of expected cash flows. |
(3) | Approximately $500 thousand of the second quarter 2018 fair value change was due to an increase in delinquencies in the quarter resulting in higher anticipated collection costs and lower mortgage servicing rights asset value. In addition, approximately $300 thousand of the fair value change was due to higher than expected prepayments of mortgage servicing rights in the second quarter of 2018. Approximately $800 thousand of the fourth quarter 2017 fair value change was due to an increase in delinquencies in the quarter. |
CONSOLIDATED BALANCE SHEETS (Unaudited) |
(Dollars in thousands) | 9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | |||||||||||||||
ASSETS | ||||||||||||||||||||
Cash and due from banks | $ | 342,933 | $ | 373,448 | $ | 332,234 | $ | 397,880 | $ | 361,080 | ||||||||||
Interest earning deposits with banks | 87,740 | 119,672 | 50,624 | 181,341 | 82,636 | |||||||||||||||
Total cash and cash equivalents | 430,673 | 493,120 | 382,858 | 579,221 | 443,716 | |||||||||||||||
Investment securities: | ||||||||||||||||||||
Securities available for sale, at fair value | 1,710,636 | 1,647,260 | 1,679,011 | 1,408,326 | 1,497,543 | |||||||||||||||
Securities held to maturity, at amortized cost | 923,082 | 923,036 | 933,319 | 959,082 | 994,238 | |||||||||||||||
Marketable equity securities, at fair value | 10,901 | 10,922 | 11,124 | — | — | |||||||||||||||
Non-marketable securities - FHLB and FRB Stock | 107,407 | 115,453 | 118,955 | 114,111 | 152,345 | |||||||||||||||
Total investment securities | 2,752,026 | 2,696,671 | 2,742,409 | 2,481,519 | 2,644,126 | |||||||||||||||
Loans held for sale | 51,834 | 423,367 | 561,549 | 548,578 | 722,754 | |||||||||||||||
Loans: | ||||||||||||||||||||
Total loans, excluding purchased credit-impaired loans | 13,843,880 | 13,719,244 | 13,824,990 | 13,846,318 | 13,753,459 | |||||||||||||||
Purchased credit-impaired loans | 91,072 | 101,001 | 109,990 | 119,744 | 131,919 | |||||||||||||||
Total loans | 13,934,952 | 13,820,245 | 13,934,980 | 13,966,062 | 13,885,378 | |||||||||||||||
Less: Allowance for loan and lease losses | 155,411 | 162,790 | 161,712 | 157,710 | 159,128 | |||||||||||||||
Net loans | 13,779,541 | 13,657,455 | 13,773,268 | 13,808,352 | 13,726,250 | |||||||||||||||
Lease investments, net | 429,843 | 433,505 | 408,798 | 409,051 | 371,541 | |||||||||||||||
Premises and equipment, net | 274,006 | 281,458 | 281,791 | 286,690 | 286,482 | |||||||||||||||
Cash surrender value of life insurance | 207,280 | 205,982 | 204,710 | 203,602 | 204,855 | |||||||||||||||
Goodwill | 999,925 | 999,925 | 1,003,548 | 1,003,548 | 999,925 | |||||||||||||||
Other intangibles | 49,114 | 50,968 | 52,864 | 54,766 | 56,745 | |||||||||||||||
Mortgage servicing rights, at fair value | 295,803 | 296,629 | 291,561 | 276,279 | 261,446 | |||||||||||||||
Other real estate owned, net | 10,933 | 10,869 | 10,528 | 9,736 | 13,020 | |||||||||||||||
Other real estate owned related to FDIC transactions | 2,661 | 2,908 | 4,185 | 4,788 | 4,817 | |||||||||||||||
Other assets | 436,332 | 413,700 | 449,454 | 420,810 | 380,858 | |||||||||||||||
Total assets | $ | 19,719,971 | $ | 19,966,557 | $ | 20,167,523 | $ | 20,086,940 | $ | 20,116,535 | ||||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||||||
Liabilities | ||||||||||||||||||||
Deposits: | ||||||||||||||||||||
Non-interest bearing | $ | 6,036,012 | $ | 6,347,208 | $ | 6,385,149 | $ | 6,381,512 | $ | 6,101,159 | ||||||||||
Interest bearing | 8,672,781 | 8,575,455 | 8,585,444 | 8,576,866 | 8,313,985 | |||||||||||||||
Total deposits | 14,708,793 | 14,922,663 | 14,970,593 | 14,958,378 | 14,415,144 | |||||||||||||||
Short-term borrowings | 903,355 | 651,462 | 717,679 | 861,039 | 1,865,415 | |||||||||||||||
Long-term borrowings | 451,677 | 730,292 | 851,221 | 505,158 | 405,715 | |||||||||||||||
Junior subordinated notes issued to capital trusts | 133,995 | 194,450 | 194,304 | 211,494 | 211,289 | |||||||||||||||
Accrued expenses and other liabilities | 556,822 | 518,997 | 499,379 | 541,048 | 526,880 | |||||||||||||||
Total liabilities | 16,754,642 | 17,017,864 | 17,233,176 | 17,077,117 | 17,424,443 | |||||||||||||||
Stockholders' Equity | ||||||||||||||||||||
Preferred stock | 194,719 | 194,719 | 194,719 | 309,999 | 115,280 | |||||||||||||||
Common stock | 862 | 861 | 860 | 858 | 858 | |||||||||||||||
Additional paid-in capital | 1,703,404 | 1,698,057 | 1,692,650 | 1,691,007 | 1,685,971 | |||||||||||||||
Retained earnings | 1,147,060 | 1,127,814 | 1,112,323 | 1,065,303 | 940,948 | |||||||||||||||
Accumulated other comprehensive (loss) income | (17,186 | ) | (9,818 | ) | (3,719 | ) | 3,584 | 9,772 | ||||||||||||
Treasury stock | (63,530 | ) | (62,940 | ) | (62,486 | ) | (60,928 | ) | (60,737 | ) | ||||||||||
Total stockholders' equity | 2,965,329 | 2,948,693 | 2,934,347 | 3,009,823 | 2,692,092 | |||||||||||||||
Total liabilities and stockholders' equity | $ | 19,719,971 | $ | 19,966,557 | $ | 20,167,523 | $ | 20,086,940 | $ | 20,116,535 |
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
(Dollars in thousands, except per share data) | 3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | ||||||||||||||||||||||
Interest income: | |||||||||||||||||||||||||||||
Loans: | |||||||||||||||||||||||||||||
Taxable | $ | 168,190 | $ | 164,401 | $ | 157,119 | $ | 154,631 | $ | 155,440 | $ | 489,710 | $ | 432,603 | |||||||||||||||
Nontaxable | 2,146 | 2,330 | 2,271 | 2,362 | 2,632 | 6,747 | 8,303 | ||||||||||||||||||||||
Investment securities: | |||||||||||||||||||||||||||||
Taxable | 10,366 | 10,578 | 7,934 | 7,696 | 8,440 | 28,878 | 26,279 | ||||||||||||||||||||||
Nontaxable | 9,387 | 9,439 | 9,476 | 9,677 | 9,731 | 28,302 | 29,541 | ||||||||||||||||||||||
Other interest earning accounts and Federal funds sold | 1,650 | 244 | 131 | 600 | 327 | 2,025 | 754 | ||||||||||||||||||||||
Total interest income | 191,739 | 186,992 | 176,931 | 174,966 | 176,570 | 555,662 | 497,480 | ||||||||||||||||||||||
Interest expense: | |||||||||||||||||||||||||||||
Deposits | 20,485 | 17,386 | 15,032 | 13,552 | 10,865 | 52,903 | 27,133 | ||||||||||||||||||||||
Short-term borrowings | 2,317 | 2,769 | 2,516 | 3,257 | 5,148 | 7,602 | 11,440 | ||||||||||||||||||||||
Long-term borrowings and junior subordinated notes | 7,089 | 7,768 | 6,002 | 4,764 | 3,610 | 20,859 | 9,923 | ||||||||||||||||||||||
Total interest expense | 29,891 | 27,923 | 23,550 | 21,573 | 19,623 | 81,364 | 48,496 | ||||||||||||||||||||||
Net interest income | 161,848 | 159,069 | 153,381 | 153,393 | 156,947 | 474,298 | 448,984 | ||||||||||||||||||||||
Provision for credit losses | 21,503 | 6,219 | 7,508 | 3,643 | 4,517 | 35,230 | 17,950 | ||||||||||||||||||||||
Net interest income after provision for credit losses | 140,345 | 152,850 | 145,873 | 149,750 | 152,430 | 439,068 | 431,034 | ||||||||||||||||||||||
Non-interest income: | |||||||||||||||||||||||||||||
Mortgage banking revenue | 9,916 | 18,926 | 25,047 | 22,374 | 28,242 | 53,889 | 86,850 | ||||||||||||||||||||||
Lease financing revenue, net | 25,205 | 22,918 | 24,710 | 23,620 | 23,148 | 72,833 | 62,967 | ||||||||||||||||||||||
Treasury management fees | 15,226 | 15,066 | 15,156 | 15,234 | 14,508 | 45,448 | 43,696 | ||||||||||||||||||||||
Wealth management fees | 9,089 | 8,969 | 9,121 | 9,024 | 8,702 | 27,179 | 25,720 | ||||||||||||||||||||||
Card fees | 5,362 | 5,654 | 4,787 | 5,032 | 4,585 | 15,803 | 13,564 | ||||||||||||||||||||||
Capital markets and international banking fees | 1,913 | 3,785 | 2,998 | 3,999 | 4,870 | 8,696 | 11,709 | ||||||||||||||||||||||
Consumer and other deposit service fees | 3,051 | 2,929 | 2,912 | 3,261 | 3,424 | 8,892 | 10,072 | ||||||||||||||||||||||
Brokerage fees | 1,138 | 1,050 | 864 | 942 | 1,004 | 3,052 | 3,379 | ||||||||||||||||||||||
Loan service fees | 2,103 | 2,148 | 2,245 | 2,197 | 2,114 | 6,496 | 6,120 | ||||||||||||||||||||||
Increase in cash surrender value of life insurance | 1,298 | 1,272 | 1,108 | 1,511 | 1,321 | 3,678 | 3,910 | ||||||||||||||||||||||
Net (loss) gain on investment securities | (85 | ) | (86 | ) | (174 | ) | 111 | 83 | (345 | ) | 451 | ||||||||||||||||||
Net loss on disposal of other assets | (32 | ) | (397 | ) | (357 | ) | (2,016 | ) | (180 | ) | (786 | ) | (307 | ) | |||||||||||||||
Other operating income | 5,657 | 6,072 | 4,385 | 4,534 | 4,110 | 16,114 | 11,420 | ||||||||||||||||||||||
Total non-interest income | 79,841 | 88,306 | 92,802 | 89,823 | 95,931 | 260,949 | 279,551 | ||||||||||||||||||||||
Non-interest expense: | |||||||||||||||||||||||||||||
Salaries and employee benefits expense | 101,885 | 123,478 | 106,514 | 109,247 | 105,815 | 331,877 | 309,932 | ||||||||||||||||||||||
Occupancy and equipment expense | 16,117 | 16,451 | 17,429 | 16,846 | 15,382 | 49,997 | 45,710 | ||||||||||||||||||||||
Computer services and telecommunication expense | 12,684 | 10,871 | 11,156 | 11,304 | 10,062 | 34,711 | 29,287 | ||||||||||||||||||||||
Advertising and marketing expense | 3,432 | 3,342 | 3,863 | 3,271 | 2,558 | 10,637 | 8,964 | ||||||||||||||||||||||
Professional and legal expense | 2,586 | 8,887 | 1,898 | 2,957 | 2,109 | 13,371 | 7,250 | ||||||||||||||||||||||
Other intangible amortization expense | 1,854 | 1,896 | 1,902 | 1,979 | 2,038 | 5,652 | 6,214 | ||||||||||||||||||||||
Branch exit and facilities impairment charges | 3,292 | 340 | — | (327 | ) | 2,773 | 3,632 | 8,680 | |||||||||||||||||||||
Net loss (gain) recognized on other real estate owned and other related expense | 248 | 1,048 | 47 | (104 | ) | (86 | ) | 1,343 | 1,448 | ||||||||||||||||||||
Loss on extinguishment of debt | 6,255 | — | 3,136 | — | — | 9,391 | — | ||||||||||||||||||||||
Goodwill impairment loss | — | 3,623 | — | — | — | 3,623 | — | ||||||||||||||||||||||
Other operating expenses | 20,191 | 23,056 | 21,941 | 30,655 | 22,310 | 65,188 | 68,030 | ||||||||||||||||||||||
Total non-interest expense | 168,544 | 192,992 | 167,886 | 175,828 | 162,961 | 529,422 | 485,515 | ||||||||||||||||||||||
Income before income taxes | 51,642 | 48,164 | 70,789 | 63,745 | 85,400 | 170,595 | 225,070 | ||||||||||||||||||||||
Income tax expense (benefit) | 8,928 | 9,631 | 14,032 | (80,449 | ) | 24,557 | 32,591 | 65,224 | |||||||||||||||||||||
Net income | 42,714 | 38,533 | 56,757 | 144,194 | 60,843 | 138,004 | 159,846 | ||||||||||||||||||||||
Dividends on preferred shares | 3,000 | 3,000 | 3,100 | 2,000 | 2,002 | 9,100 | 6,007 | ||||||||||||||||||||||
Return from preferred stockholders due to redemption | — | — | (15,280 | ) | — | — | (15,280 | ) | — | ||||||||||||||||||||
Net income available to common stockholders | $ | 39,714 | $ | 35,533 | $ | 68,937 | $ | 142,194 | $ | 58,841 | $ | 144,184 | $ | 153,839 |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Common share data: | |||||||||||||||||||||||||||||
Basic earnings per common share | $ | 0.47 | $ | 0.42 | $ | 0.82 | $ | 1.69 | $ | 0.70 | $ | 1.71 | $ | 1.84 | |||||||||||||||
Diluted earnings per common share | 0.47 | 0.42 | 0.81 | 1.67 | 0.69 | 1.69 | 1.81 | ||||||||||||||||||||||
Diluted operating earnings per common share, excluding Mortgage Banking Segment | 0.60 | 0.68 | 0.64 | 0.54 | 0.69 | 1.92 | 1.79 | ||||||||||||||||||||||
Weighted average common shares outstanding for basic earnings per common share | 84,369,519 | 84,253,966 | 84,065,681 | 83,946,637 | 83,891,175 | 84,230,835 | 83,799,694 | ||||||||||||||||||||||
Weighted average common shares outstanding for diluted earnings per common share | 85,335,109 | 85,251,810 | 84,896,401 | 84,964,759 | 84,779,797 | 85,162,220 | 84,775,952 | ||||||||||||||||||||||
Common shares outstanding (at end of period) | 84,220,671 | 84,194,594 | 84,052,547 | 83,917,892 | 83,887,097 | 84,220,671 | 83,887,097 |
SELECTED FINANCIAL DATA |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Performance Ratios: | |||||||||||||||||||||||||||||
Annualized return on average assets | 0.85 | % | 0.77 | % | 1.15 | % | 2.84 | % | 1.21 | % | 0.92 | % | 1.10 | % | |||||||||||||||
Annualized operating return, excluding Mortgage Banking Segment, on average assets (1) | 1.19 | 1.35 | 1.32 | 1.07 | 1.37 | 1.29 | 1.22 | ||||||||||||||||||||||
Annualized return on average common equity | 5.71 | 5.20 | 10.32 | 21.87 | 9.17 | 7.04 | 8.19 | ||||||||||||||||||||||
Annualized operating return, excluding Mortgage Banking Segment, on average common equity (1) | 7.41 | 8.42 | 8.17 | 7.10 | 9.12 | 8.00 | 8.06 | ||||||||||||||||||||||
Annualized cash return on average tangible common equity (2) | 9.46 | 8.70 | 17.12 | 36.90 | 15.81 | 11.68 | 14.34 | ||||||||||||||||||||||
Annualized cash operating return, excluding Mortgage Banking Segment, on average tangible common equity (3) | 12.18 | 13.89 | 13.62 | 12.21 | 15.74 | 13.22 | 14.12 | ||||||||||||||||||||||
Efficiency ratio (4) | 60.35 | 66.80 | 65.62 | 65.38 | 61.24 | 64.29 | 63.17 | ||||||||||||||||||||||
Efficiency ratio, excluding Mortgage Banking Segment (4) | 57.90 | 60.40 | 59.72 | 59.48 | 56.15 | 59.33 | 58.11 | ||||||||||||||||||||||
Annualized net non-interest expense to average assets (5) | 1.35 | 1.57 | 1.43 | 1.44 | 1.25 | 1.45 | 1.33 | ||||||||||||||||||||||
Core non-interest income to revenues (6) | 32.49 | 35.34 | 37.45 | 36.18 | 36.91 | 35.11 | 37.23 | ||||||||||||||||||||||
Core non-interest income to revenues, excluding Mortgage Banking Segment(6) | 30.63 | 31.43 | 31.97 | 31.38 | 30.72 | 31.33 | 30.43 | ||||||||||||||||||||||
Net interest margin - fully tax equivalent basis (7) | 3.81 | 3.73 | 3.67 | 3.63 | 3.76 | 3.74 | 3.72 | ||||||||||||||||||||||
Net interest margin - fully tax equivalent basis excluding acquisition accounting discount accretion on bank merger loans (8) | 3.70 | 3.62 | 3.55 | 3.49 | 3.56 | 3.62 | 3.53 | ||||||||||||||||||||||
Cost of funds (9) | 0.72 | 0.67 | 0.58 | 0.51 | 0.46 | 0.65 | 0.39 | ||||||||||||||||||||||
Loans to deposits | 94.74 | 92.61 | 93.08 | 93.37 | 96.32 | 94.74 | 96.32 | ||||||||||||||||||||||
Asset Quality Ratios: | |||||||||||||||||||||||||||||
Non-performing loans (10) to total loans | 0.53 | % | 0.50 | % | 0.44 | % | 0.55 | % | 0.36 | % | 0.53 | % | 0.36 | % | |||||||||||||||
Non-performing assets (10) to total assets | 0.43 | 0.40 | 0.36 | 0.43 | 0.32 | 0.43 | 0.32 | ||||||||||||||||||||||
Allowance for loan and lease losses to non-performing loans (10) | 210.78 | 237.56 | 263.72 | 205.33 | 314.39 | 210.78 | 314.39 | ||||||||||||||||||||||
Allowance for loan and lease losses to total loans | 1.12 | 1.18 | 1.16 | 1.13 | 1.15 | 1.12 | 1.15 | ||||||||||||||||||||||
Net loan charge-offs (recoveries) to average loans, excluding loans held for sale (annualized) | 0.82 | 0.15 | 0.10 | 0.16 | (0.02 | ) | 0.36 | (0.02 | ) | ||||||||||||||||||||
Capital Ratios: | |||||||||||||||||||||||||||||
Tangible equity to tangible assets (11) | 10.33 | % | 10.10 | % | 9.89 | % | 10.32 | % | 8.68 | % | 10.33 | % | 8.68 | % | |||||||||||||||
Tangible common equity to tangible assets (12) | 9.28 | 9.07 | 8.87 | 8.70 | 8.07 | 9.28 | 8.07 | ||||||||||||||||||||||
Tangible common equity to risk weighted assets (13) | 10.07 | 9.99 | 9.85 | 9.71 | 8.99 | 10.07 | 8.99 | ||||||||||||||||||||||
Total capital to risk-weighted assets (14) | 13.48 | 13.75 | 13.57 | 14.23 | 11.67 | 13.48 | 11.67 | ||||||||||||||||||||||
Tier 1 capital to risk-weighted assets (14) | 10.96 | 10.81 | 10.64 | 11.20 | 9.46 | 10.96 | 9.46 | ||||||||||||||||||||||
Common equity tier 1 capital to risk-weighted assets (14) | 9.83 | 9.68 | 9.51 | 9.40 | 8.80 | 9.83 | 8.80 | ||||||||||||||||||||||
Tier 1 capital to average assets (leverage ratio) (14) | 9.99 | 9.74 | 9.73 | 10.02 | 8.59 | 9.99 | 8.59 |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Per Share Data: | |||||||||||||||||||||||||||||
Book value per common share (15) | $ | 32.90 | $ | 32.71 | $ | 32.59 | $ | 32.17 | $ | 30.72 | $ | 32.90 | $ | 30.72 | |||||||||||||||
Less: goodwill and other intangible assets, net of tax benefit, per common share | 12.30 | 12.32 | 12.40 | 12.44 | 12.36 | 12.30 | 12.36 | ||||||||||||||||||||||
Tangible book value per common share (16) | $ | 20.60 | $ | 20.39 | $ | 20.19 | $ | 19.73 | $ | 18.36 | $ | 20.60 | $ | 18.36 | |||||||||||||||
Cash dividends per common share | $ | 0.24 | $ | 0.24 | $ | 0.24 | $ | 0.21 | $ | 0.21 | $ | 0.72 | $ | 0.61 |
(1) | Annualized operating return, excluding Mortgage Banking Segment, on average assets is computed by dividing annualized operating earnings, excluding Mortgage Banking Segment, by average total assets. Annualized operating return, excluding Mortgage Banking Segment, on average common equity is computed by dividing annualized operating earnings, excluding Mortgage Banking Segment, less dividends on preferred shares by average common equity. Operating earnings, excluding Mortgage Banking Segment, is defined as net income as reported less non-core items, net of tax and less operating earnings (loss) from our Mortgage Banking Segment. |
(2) | Annualized cash return on average tangible common equity is computed by dividing net cash flow available to common stockholders (net income available to common stockholders, plus other intangibles amortization expense, net of tax benefit) by average tangible common equity (average common stockholders' equity less average goodwill and average other intangibles, net of tax benefit). |
(3) | Annualized cash operating return, excluding Mortgage Banking Segment, on average tangible common equity is computed by dividing annualized cash operating earnings, excluding Mortgage Banking Segment, (operating earnings, excluding Mortgage Banking Segment, plus other intangibles amortization expense, net of tax benefit, less dividends on preferred shares) by average tangible common equity. Operating earnings, excluding Mortgage Banking Segment, is defined as net income as reported less non-core items, net of tax and less operating earnings (loss) from our Mortgage Banking Segment. |
(4) | Equals total non-interest expense excluding non-core items divided by the sum of net interest income on a fully tax equivalent basis, total non-interest income less non-core items, and tax equivalent adjustment on the increase in cash surrender value of life insurance. |
(5) | Equals total non-interest expense excluding non-core items less total non-interest income excluding non-core items plus the tax equivalent adjustment on the increase in cash surrender value of life insurance divided by average assets. |
(6) | Equals total non-interest income excluding non-core items and tax equivalent adjustment on the increase in cash surrender value of life insurance divided by the sum of net interest income on a fully tax equivalent basis, total non-interest income less non-core items, and tax equivalent adjustment on the increase in cash surrender value of life insurance. |
(7) | Represents net interest income on a fully tax equivalent basis assuming a Federal tax rate of 21% for 2018 and 35% for 2017, as a percentage of average interest earning assets. |
(8) | Represents net interest income on a fully tax equivalent basis assuming a Federal tax rate of 21% for 2018 and 35% for 2017, excluding acquisition accounting discount accretion on bank merger loans as a percentage of average interest earning assets. |
(9) | Equals total interest expense divided by the sum of average interest bearing liabilities and non-interest bearing deposits. |
(10) | Non-performing loans exclude purchased credit-impaired loans and loans held for sale. Non-performing assets exclude purchased credit-impaired loans, loans held for sale, and other real estate owned related to FDIC transactions. |
(11) | Equals total ending stockholders’ equity less goodwill and other intangibles, net of tax benefit, divided by total assets less goodwill and other intangibles, net of tax benefit. |
(12) | Equals total ending common stockholders’ equity less goodwill and other intangibles, net of tax benefit, divided by total assets less goodwill and other intangibles, net of tax benefit. |
(13) | Equals total ending common stockholders’ equity less goodwill and other intangibles, net of tax benefit, divided by risk-weighted assets. Current quarter risk-weighted assets are estimated. |
(14) | Current quarter ratios are estimated. |
(15) | Equals total ending common stockholders’ equity divided by common shares outstanding. |
(16) | Equals total ending common stockholders’ equity less goodwill and other intangibles, net of tax benefit, divided by common shares outstanding. |
INVESTMENT SECURITIES |
9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | ||||||||||||||||
Securities available for sale: | ||||||||||||||||||||
Fair value | ||||||||||||||||||||
Government sponsored agencies and enterprises | $ | 5,002 | $ | 5,026 | $ | 22,885 | $ | 23,007 | $ | 23,146 | ||||||||||
States and political subdivisions | 343,256 | 350,061 | 366,906 | 379,325 | 385,829 | |||||||||||||||
Mortgage-backed securities | 1,357,314 | 1,269,003 | 1,251,229 | 924,734 | 962,477 | |||||||||||||||
Corporate bonds | 5,064 | 23,170 | 37,991 | 70,197 | 115,014 | |||||||||||||||
Equity securities (1) | — | — | — | 11,063 | 11,077 | |||||||||||||||
Total fair value | $ | 1,710,636 | $ | 1,647,260 | $ | 1,679,011 | $ | 1,408,326 | $ | 1,497,543 | ||||||||||
Unrealized (loss) gain, net | ||||||||||||||||||||
Government sponsored agencies and enterprises | $ | (85 | ) | $ | (72 | ) | $ | (63 | ) | $ | (6 | ) | $ | 69 | ||||||
States and political subdivisions | 8,222 | 11,134 | 11,848 | 15,512 | 19,642 | |||||||||||||||
Mortgage-backed securities | (28,026 | ) | (20,502 | ) | (15,166 | ) | (8,414 | ) | (2,101 | ) | ||||||||||
Corporate bonds | (1 | ) | (9 | ) | (29 | ) | 42 | 433 | ||||||||||||
Equity securities (1) | — | — | — | (173 | ) | (100 | ) | |||||||||||||
Total unrealized (loss) gain, net | $ | (19,890 | ) | $ | (9,449 | ) | $ | (3,410 | ) | $ | 6,961 | $ | 17,943 | |||||||
Securities held to maturity, at amortized cost: | ||||||||||||||||||||
States and political subdivisions | $ | 899,865 | $ | 884,576 | $ | 874,306 | $ | 878,400 | $ | 888,576 | ||||||||||
Mortgage-backed securities | 23,217 | 38,460 | 59,013 | 80,682 | 105,662 | |||||||||||||||
Total amortized cost | $ | 923,082 | $ | 923,036 | $ | 933,319 | $ | 959,082 | $ | 994,238 |
(1) | Reflected in marketable equity securities on the consolidated balance sheet following the adoption of the new investments in equity securities guidance on January 1, 2018. |
LOAN PORTFOLIO |
9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | |||||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||
Commercial-related loans: | |||||||||||||||||||||||||||||||||||
Commercial | $ | 4,936,536 | 35 | % | $ | 4,816,545 | 35 | % | $ | 4,790,803 | 34 | % | $ | 4,786,180 | 34 | % | $ | 4,793,838 | 35 | % | |||||||||||||||
Commercial loans collateralized by assignment of lease payments (lease loans) | 2,065,588 | 15 | 2,100,460 | 15 | 2,095,189 | 15 | 2,113,135 | 15 | 2,074,215 | 15 | |||||||||||||||||||||||||
Commercial real estate | 3,832,032 | 28 | 3,929,327 | 28 | 4,093,045 | 29 | 4,147,529 | 30 | 4,094,706 | 29 | |||||||||||||||||||||||||
Construction real estate | 548,882 | 4 | 495,805 | 4 | 479,638 | 4 | 406,849 | 3 | 395,794 | 3 | |||||||||||||||||||||||||
Total commercial-related loans | 11,383,038 | 82 | 11,342,137 | 82 | 11,458,675 | 82 | 11,453,693 | 82 | 11,358,553 | 82 | |||||||||||||||||||||||||
Other loans: | |||||||||||||||||||||||||||||||||||
Residential real estate (1) | 1,403,087 | 10 | 1,352,625 | 10 | 1,391,900 | 10 | 1,432,458 | 10 | 1,433,595 | 10 | |||||||||||||||||||||||||
Indirect vehicle | 790,573 | 5 | 749,983 | 5 | 692,642 | 5 | 667,928 | 4 | 655,213 | 4 | |||||||||||||||||||||||||
Home equity | 181,477 | 1 | 192,785 | 1 | 202,920 | 1 | 219,098 | 2 | 228,726 | 2 | |||||||||||||||||||||||||
Consumer | 85,705 | 1 | 81,714 | 1 | 78,853 | 1 | 73,141 | 1 | 77,372 | 1 | |||||||||||||||||||||||||
Total other loans | 2,460,842 | 17 | 2,377,107 | 17 | 2,366,315 | 17 | 2,392,625 | 17 | 2,394,906 | 17 | |||||||||||||||||||||||||
Total loans, excluding purchased credit-impaired loans | 13,843,880 | 99 | 13,719,244 | 99 | 13,824,990 | 99 | 13,846,318 | 99 | 13,753,459 | 99 | |||||||||||||||||||||||||
Purchased credit-impaired loans | 91,072 | 1 | 101,001 | 1 | 109,990 | 1 | 119,744 | 1 | 131,919 | 1 | |||||||||||||||||||||||||
Total loans | $ | 13,934,952 | 100 | % | $ | 13,820,245 | 100 | % | $ | 13,934,980 | 100 | % | $ | 13,966,062 | 100 | % | $ | 13,885,378 | 100 | % | |||||||||||||||
Change in total loans, excluding purchased credit-impaired loans: | |||||||||||||||||||||||||||||||||||
From prior quarter | +0.9 | % | -0.8 | % | -0.2 | % | +0.7 | % | +2.1 | % | |||||||||||||||||||||||||
From same quarter one year ago | +0.7 | % | +1.9 | % | +8.1 | % | +9.8 | % | +11.1 | % |
(1) | Reflects a $75.5 million transfer as of September 30, 2018 from loans held for sale of GNMA loans previously sold that were eligible for repurchase. |
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | |||||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||
Commercial-related loans: | |||||||||||||||||||||||||||||||||||
Commercial | $ | 4,906,844 | 35 | % | $ | 4,770,098 | 34 | % | $ | 4,750,035 | 34 | % | $ | 4,638,618 | 34 | % | $ | 4,630,865 | 34 | % | |||||||||||||||
Commercial loans collateralized by assignment of lease payments (lease loans) | 2,029,053 | 15 | 2,065,688 | 15 | 2,084,396 | 15 | 2,074,655 | 15 | 2,057,461 | 15 | |||||||||||||||||||||||||
Commercial real estate | 3,883,132 | 28 | 4,033,421 | 29 | 4,133,826 | 30 | 4,131,179 | 30 | 3,953,639 | 29 | |||||||||||||||||||||||||
Construction real estate | 511,193 | 4 | 491,440 | 4 | 443,329 | 3 | 410,416 | 3 | 442,197 | 3 | |||||||||||||||||||||||||
Total commercial-related loans | 11,330,222 | 82 | 11,360,647 | 82 | 11,411,586 | 82 | 11,254,868 | 82 | 11,084,162 | 81 | |||||||||||||||||||||||||
Other loans: | |||||||||||||||||||||||||||||||||||
Residential real estate | 1,355,501 | 10 | 1,371,020 | 10 | 1,415,374 | 10 | 1,430,219 | 10 | 1,433,866 | 11 | |||||||||||||||||||||||||
Indirect vehicle | 770,047 | 5 | 720,052 | 5 | 676,590 | 5 | 663,474 | 4 | 641,328 | 4 | |||||||||||||||||||||||||
Home equity | 187,347 | 1 | 199,334 | 1 | 211,729 | 1 | 223,445 | 2 | 234,460 | 2 | |||||||||||||||||||||||||
Consumer | 83,677 | 1 | 82,189 | 1 | 76,606 | 1 | 76,249 | 1 | 76,591 | 1 | |||||||||||||||||||||||||
Total other loans | 2,396,572 | 17 | 2,372,595 | 17 | 2,380,299 | 17 | 2,393,387 | 17 | 2,386,245 | 18 | |||||||||||||||||||||||||
Total loans, excluding purchased credit-impaired loans | 13,726,794 | 99 | 13,733,242 | 99 | 13,791,885 | 99 | 13,648,255 | 99 | 13,470,407 | 99 | |||||||||||||||||||||||||
Purchased credit-impaired loans | 94,916 | 1 | 105,781 | 1 | 113,942 | 1 | 127,781 | 1 | 139,246 | 1 | |||||||||||||||||||||||||
Total loans | $ | 13,821,710 | 100 | % | $ | 13,839,023 | 100 | % | $ | 13,905,827 | 100 | % | $ | 13,776,036 | 100 | % | $ | 13,609,653 | 100 | % | |||||||||||||||
Change in total loans, excluding purchased credit-impaired loans: | |||||||||||||||||||||||||||||||||||
From prior quarter | -0.1 | % | -0.4 | % | +1.1 | % | +1.3 | % | +3.3 | % | |||||||||||||||||||||||||
From same quarter one year ago | +1.9 | % | +5.3 | % | +10.1 | % | +10.5 | % | +23.2 | % |
ASSET QUALITY |
9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | ||||||||||||||||
Non-performing loans: | ||||||||||||||||||||
Non-accrual loans (1) | $ | 72,437 | $ | 64,515 | $ | 60,151 | $ | 71,238 | $ | 49,926 | ||||||||||
Loans 90 days or more past due, still accruing interest | 1,294 | 4,010 | 1,169 | 5,570 | 689 | |||||||||||||||
Total non-performing loans | 73,731 | 68,525 | 61,320 | 76,808 | 50,615 | |||||||||||||||
Other real estate owned | 10,933 | 10,869 | 10,528 | 9,736 | 13,020 | |||||||||||||||
Repossessed assets | 870 | 643 | 661 | 589 | 497 | |||||||||||||||
Total non-performing assets | $ | 85,534 | $ | 80,037 | $ | 72,509 | $ | 87,133 | $ | 64,132 | ||||||||||
Potential problem loans (2) | $ | 245,131 | $ | 243,684 | $ | 208,201 | $ | 173,266 | $ | 160,840 | ||||||||||
Purchased credit-impaired loans (3) | $ | 91,072 | $ | 101,001 | $ | 109,990 | $ | 119,744 | $ | 131,919 | ||||||||||
Total non-performing, potential problem and purchased credit-impaired loans | $ | 409,934 | $ | 413,210 | $ | 379,511 | $ | 369,818 | $ | 343,374 | ||||||||||
Total allowance for loan and lease losses | $ | 155,411 | $ | 162,790 | $ | 161,712 | $ | 157,710 | $ | 159,128 | ||||||||||
Accruing restructured loans (4) | 22,970 | 25,660 | 28,591 | 28,554 | 32,850 | |||||||||||||||
Total non-performing loans to total loans | 0.53 | % | 0.50 | % | 0.44 | % | 0.55 | % | 0.36 | % | ||||||||||
Total non-performing assets to total assets | 0.43 | 0.40 | 0.36 | 0.43 | 0.32 | |||||||||||||||
Allowance for loan and lease losses to non-performing loans | 210.78 | 237.56 | 263.72 | 205.33 | 314.39 |
(1) | Includes $24.0 million, $26.2 million, $28.5 million, $30.8 million, and $24.4 million of restructured loans on non-accrual status at September 30, 2018, June 30, 2018, March 31, 2018, December 31, 2017, and September 30, 2017, respectively. |
(2) | We define potential problem loans as loans rated substandard that do not meet the definition of a non-performing loan. Potential problem loans carry a higher probability of default and require additional attention by management. |
(3) | Includes $40.2 million, $43.6 million, $49.5 million, $54.9 million, and $60.1 million of Government National Mortgage Association ("GNMA") loans that have been repurchased at September 30, 2018, June 30, 2018, March 31, 2018, December 31, 2017, and September 30, 2017, respectively. |
(4) | Accruing restructured loans consist of loans that have been modified and are performing in accordance with those modified terms as of the dates indicated. |
9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | ||||||||||||||||
Commercial and lease | $ | 25,378 | $ | 19,788 | $ | 13,843 | $ | 18,522 | $ | 8,493 | ||||||||||
Commercial real estate | 10,556 | 11,400 | 10,986 | 21,235 | 7,753 | |||||||||||||||
Consumer-related | 37,797 | 37,337 | 36,491 | 37,051 | 34,369 | |||||||||||||||
Total non-performing loans | $ | 73,731 | $ | 68,525 | $ | 61,320 | $ | 76,808 | $ | 50,615 |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Allowance for credit losses, at beginning of period | $ | 164,578 | $ | 163,390 | $ | 159,408 | $ | 161,404 | $ | 156,297 | $ | 159,408 | $ | 141,842 | |||||||||||||||
Provision for credit losses | 21,503 | 6,219 | 7,508 | 3,643 | 4,517 | 35,230 | 17,950 | ||||||||||||||||||||||
Charge-offs | 31,600 | 6,720 | 6,818 | 7,448 | 2,830 | 45,138 | 9,124 | ||||||||||||||||||||||
Recoveries | 2,938 | 1,689 | 3,292 | 1,809 | 3,420 | 7,919 | 10,736 | ||||||||||||||||||||||
Net charge-offs (recoveries) | 28,662 | 5,031 | 3,526 | 5,639 | (590 | ) | 37,219 | (1,612 | ) | ||||||||||||||||||||
Allowance for credit losses, at end of period | 157,419 | 164,578 | 163,390 | 159,408 | 161,404 | 157,419 | 161,404 | ||||||||||||||||||||||
Allowance for unfunded credit commitments | (2,008 | ) | (1,788 | ) | (1,678 | ) | (1,698 | ) | (2,276 | ) | (2,008 | ) | (2,276 | ) | |||||||||||||||
Allowance for loan and lease losses, at end of period | $ | 155,411 | $ | 162,790 | $ | 161,712 | $ | 157,710 | $ | 159,128 | $ | 155,411 | $ | 159,128 | |||||||||||||||
Total loans, excluding loans held for sale | $ | 13,934,952 | $ | 13,820,245 | $ | 13,934,980 | $ | 13,966,062 | $ | 13,885,378 | $ | 13,934,952 | $ | 13,885,378 | |||||||||||||||
Average loans, excluding loans held for sale | 13,821,710 | 13,839,023 | 13,905,827 | 13,776,036 | 13,609,653 | 13,855,213 | 13,169,448 | ||||||||||||||||||||||
Allowance for loan and lease losses to total loans, excluding loans held for sale | 1.12 | % | 1.18 | % | 1.16 | % | 1.13 | % | 1.15 | % | 1.12 | % | 1.15 | % | |||||||||||||||
Net loan charge-offs (recoveries) to average loans, excluding loans held for sale (annualized) | 0.82 | 0.15 | 0.10 | 0.16 | (0.02 | ) | 0.36 | (0.02 | ) |
9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | ||||||||||||||||
Commercial related loans: | ||||||||||||||||||||
General reserve | $ | 137,588 | $ | 139,356 | $ | 137,284 | $ | 132,787 | $ | 137,617 | ||||||||||
Specific reserve | 1,235 | 6,544 | 7,290 | 6,056 | 2,453 | |||||||||||||||
Consumer related reserve | 16,588 | 16,890 | 17,138 | 18,867 | 19,058 | |||||||||||||||
Total allowance for loan and lease losses | $ | 155,411 | $ | 162,790 | $ | 161,712 | $ | 157,710 | $ | 159,128 |
Non-Accretable Discount - PCI Loans | Accretable Discount - PCI Loans | Accretable Discount - Non-PCI Loans | Total | |||||||||||||
Balance at beginning of period | $ | 6,308 | $ | 8,241 | $ | 16,451 | $ | 31,000 | ||||||||
Recoveries, net | 113 | — | — | 113 | ||||||||||||
Accretion | — | (2,579 | ) | (1,971 | ) | (4,550 | ) | |||||||||
Transfer (1) | (236 | ) | 236 | — | — | |||||||||||
Balance at end of period | $ | 6,185 | $ | 5,898 | $ | 14,480 | $ | 26,563 |
(1) | The transfer from non-accretable discount on purchased credit-impaired loans to accretable discount was due to better than expected cash flows on several pools of purchased credit-impaired loans. |
DEPOSIT MIX |
9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | |||||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||
Low-cost deposits: | |||||||||||||||||||||||||||||||||||
Non-interest bearing deposits | $ | 6,036,012 | 41 | % | $ | 6,347,208 | 43 | % | $ | 6,385,149 | 43 | % | $ | 6,381,512 | 43 | % | $ | 6,101,159 | 42 | % | |||||||||||||||
Money market, NOW, and interest bearing deposits | 5,125,330 | 35 | 4,950,676 | 33 | 4,858,506 | 32 | 4,954,765 | 33 | 4,842,097 | 34 | |||||||||||||||||||||||||
Savings deposits | 1,180,997 | 8 | 1,181,078 | 8 | 1,229,968 | 8 | 1,167,810 | 8 | 1,088,194 | 7 | |||||||||||||||||||||||||
Total low-cost deposits | 12,342,339 | 84 | 12,478,962 | 84 | 12,473,623 | 83 | 12,504,087 | 84 | 12,031,450 | 83 | |||||||||||||||||||||||||
Certificates of deposit: | |||||||||||||||||||||||||||||||||||
Certificates of deposit | 1,392,020 | 9 | 1,361,611 | 9 | 1,397,868 | 10 | 1,392,409 | 9 | 1,381,993 | 10 | |||||||||||||||||||||||||
Brokered certificates of deposit | 974,434 | 7 | 1,082,090 | 7 | 1,099,102 | 7 | 1,061,882 | 7 | 1,001,701 | 7 | |||||||||||||||||||||||||
Total certificates of deposit | 2,366,454 | 16 | 2,443,701 | 16 | 2,496,970 | 17 | 2,454,291 | 16 | 2,383,694 | 17 | |||||||||||||||||||||||||
Total deposits | $ | 14,708,793 | 100 | % | $ | 14,922,663 | 100 | % | $ | 14,970,593 | 100 | % | $ | 14,958,378 | 100 | % | $ | 14,415,144 | 100 | % | |||||||||||||||
Change in total deposits: | |||||||||||||||||||||||||||||||||||
From prior quarter | -1.4 | % | -0.3 | % | +0.1 | % | +3.8 | % | +1.1 | % | |||||||||||||||||||||||||
From same quarter one year ago | +2.0 | % | +4.6 | % | +6.9 | % | +6.0 | % | +1.0 | % |
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | |||||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||
Low-cost deposits: | |||||||||||||||||||||||||||||||||||
Non-interest bearing deposits | $ | 6,418,925 | 43 | % | $ | 6,414,450 | 43 | % | $ | 6,293,453 | 42 | % | $ | 6,370,801 | 43 | % | $ | 6,337,955 | 44 | % | |||||||||||||||
Money market, NOW, and interest bearing deposits | 5,042,158 | 33 | 4,878,700 | 32 | 4,871,501 | 33 | 4,976,854 | 33 | 4,740,210 | 33 | |||||||||||||||||||||||||
Savings deposits | 1,172,627 | 8 | 1,209,360 | 8 | 1,208,843 | 8 | 1,120,550 | 7 | 1,094,625 | 7 | |||||||||||||||||||||||||
Total low-cost deposits | 12,633,710 | 84 | 12,502,510 | 83 | 12,373,797 | 83 | 12,468,205 | 83 | 12,172,790 | 84 | |||||||||||||||||||||||||
Certificates of deposit: | |||||||||||||||||||||||||||||||||||
Certificates of deposit | 1,370,866 | 9 | 1,400,201 | 10 | 1,383,260 | 10 | 1,393,210 | 10 | 1,369,401 | 10 | |||||||||||||||||||||||||
Brokered certificates of deposit | 1,028,420 | 7 | 1,093,525 | 7 | 1,075,056 | 7 | 1,092,990 | 7 | 869,687 | 6 | |||||||||||||||||||||||||
Total certificates of deposit | 2,399,286 | 16 | 2,493,726 | 17 | 2,458,316 | 17 | 2,486,200 | 17 | 2,239,088 | 16 | |||||||||||||||||||||||||
Total deposits | $ | 15,032,996 | 100 | % | $ | 14,996,236 | 100 | % | $ | 14,832,113 | 100 | % | $ | 14,954,405 | 100 | % | $ | 14,411,878 | 100 | % | |||||||||||||||
Change in total deposits: | |||||||||||||||||||||||||||||||||||
From prior quarter | +0.2 | % | +1.1 | % | -0.8 | % | +3.8 | % | +2.3 | % | |||||||||||||||||||||||||
From same quarter one year ago | +4.3 | % | +6.4 | % | +6.5 | % | +4.8 | % | +13.2 | % |
NET INTEREST MARGIN |
3Q18 | 2Q18 | 3Q17 | ||||||||||||||||||||||||||||||||
Average Balance | Interest | Yield/ Rate | Average Balance | Interest | Yield/ Rate | Average Balance | Interest | Yield/ Rate | ||||||||||||||||||||||||||
Interest Earning Assets: | ||||||||||||||||||||||||||||||||||
Loans held for sale | $ | 196,180 | $ | 1,608 | 3.28 | % | $ | 573,444 | $ | 5,429 | 3.79 | % | $ | 725,899 | $ | 6,651 | 3.67 | % | ||||||||||||||||
Loans (1) (2) (3): | ||||||||||||||||||||||||||||||||||
Commercial-related loans: | ||||||||||||||||||||||||||||||||||
Commercial | 4,906,844 | 64,512 | 5.14 | 4,770,098 | 59,351 | 4.92 | 4,630,865 | 53,567 | 4.53 | |||||||||||||||||||||||||
Commercial loans collateralized by assignment of lease payments (lease loans) | 2,029,053 | 20,262 | 3.99 | 2,065,688 | 19,847 | 3.84 | 2,057,461 | 19,381 | 3.77 | |||||||||||||||||||||||||
Commercial real estate | 3,883,132 | 50,185 | 5.06 | 4,033,421 | 50,053 | 4.91 | 3,953,639 | 46,587 | 4.61 | |||||||||||||||||||||||||
Construction real estate | 511,193 | 6,521 | 4.99 | 491,440 | 5,943 | 4.78 | 442,197 | 4,689 | 4.15 | |||||||||||||||||||||||||
Total commercial-related loans | 11,330,222 | 141,480 | 4.90 | 11,360,647 | 135,194 | 4.72 | 11,084,162 | 124,224 | 4.40 | |||||||||||||||||||||||||
Other loans: | ||||||||||||||||||||||||||||||||||
Residential real estate | 1,355,501 | 11,048 | 3.26 | 1,371,020 | 11,039 | 3.22 | 1,433,866 | 11,579 | 3.23 | |||||||||||||||||||||||||
Indirect | 770,047 | 9,541 | 4.92 | 720,052 | 8,646 | 4.82 | 641,328 | 7,528 | 4.66 | |||||||||||||||||||||||||
Home equity | 187,347 | 2,295 | 4.86 | 199,334 | 2,310 | 4.65 | 234,460 | 2,515 | 4.26 | |||||||||||||||||||||||||
Consumer | 83,677 | 856 | 4.06 | 82,189 | 828 | 4.04 | 76,591 | 831 | 4.31 | |||||||||||||||||||||||||
Total other loans | 2,396,572 | 23,740 | 3.95 | 2,372,595 | 22,823 | 3.85 | 2,386,245 | 22,453 | 3.75 | |||||||||||||||||||||||||
Total loans, excluding purchased credit-impaired loans | 13,726,794 | 165,220 | 4.73 | 13,733,242 | 158,017 | 4.57 | 13,470,407 | 146,677 | 4.29 | |||||||||||||||||||||||||
Purchased credit-impaired loans | 94,916 | 4,079 | 17.05 | 105,781 | 3,904 | 14.80 | 139,246 | 6,161 | 17.55 | |||||||||||||||||||||||||
Total loans | 13,821,710 | 169,299 | 4.82 | 13,839,023 | 161,921 | 4.64 | 13,609,653 | 152,838 | 4.42 | |||||||||||||||||||||||||
Taxable investment securities | 1,455,771 | 10,366 | 2.85 | 1,510,287 | 10,579 | 2.80 | 1,445,619 | 8,440 | 2.34 | |||||||||||||||||||||||||
Investment securities exempt from federal income taxes (3) | 1,220,193 | 11,882 | 3.90 | 1,222,531 | 11,948 | 3.91 | 1,255,025 | 14,971 | 4.77 | |||||||||||||||||||||||||
Federal funds sold | 383 | 2 | 2.21 | 265 | 2 | 2.17 | 38 | 0 | 1.74 | |||||||||||||||||||||||||
Other interest earning deposits | 375,961 | 1,648 | 1.74 | 129,274 | 242 | 0.75 | 147,065 | 327 | 0.88 | |||||||||||||||||||||||||
Total interest earning assets | $ | 17,070,198 | $ | 194,805 | 4.50 | % | $ | 17,274,824 | $ | 190,121 | 4.37 | % | $ | 17,183,299 | $ | 183,227 | 4.21 | % | ||||||||||||||||
Non-interest earning assets | 2,907,225 | 2,882,363 | 2,762,556 | |||||||||||||||||||||||||||||||
Total assets | $ | 19,977,423 | $ | 20,157,187 | $ | 19,945,855 | ||||||||||||||||||||||||||||
Interest Bearing Liabilities: | ||||||||||||||||||||||||||||||||||
Core funding: | ||||||||||||||||||||||||||||||||||
Money market, NOW, and interest bearing deposits | $ | 5,042,158 | $ | 10,183 | 0.80 | % | $ | 4,878,700 | $ | 7,647 | 0.63 | % | $ | 4,740,210 | $ | 4,485 | 0.38 | % | ||||||||||||||||
Savings deposits | 1,172,627 | 919 | 0.31 | 1,209,360 | 886 | 0.29 | 1,094,625 | 289 | 0.10 | |||||||||||||||||||||||||
Certificates of deposit | 1,370,866 | 4,300 | 1.24 | 1,400,201 | 3,796 | 1.09 | 1,369,401 | 2,757 | 0.80 | |||||||||||||||||||||||||
Customer repurchase agreements | 232,584 | 276 | 0.47 | 222,033 | 247 | 0.45 | 200,008 | 114 | 0.23 | |||||||||||||||||||||||||
Total core funding | 7,818,235 | 15,678 | 0.80 | 7,710,294 | 12,576 | 0.65 | 7,404,244 | 7,645 | 0.41 | |||||||||||||||||||||||||
Wholesale funding: | ||||||||||||||||||||||||||||||||||
Brokered certificates of deposit (includes fee expense) | 1,028,420 | 5,083 | 1.96 | 1,093,525 | 5,057 | 1.85 | 869,687 | 3,334 | 1.52 | |||||||||||||||||||||||||
Other borrowings | 1,232,992 | 9,130 | 2.90 | 1,512,888 | 10,290 | 2.69 | 2,192,200 | 8,644 | 1.54 | |||||||||||||||||||||||||
Total wholesale funding | 2,261,412 | 14,213 | 2.47 | 2,606,413 | 15,347 | 2.34 | 3,061,887 | 11,978 | 1.54 | |||||||||||||||||||||||||
Total interest bearing liabilities | $ | 10,079,647 | $ | 29,891 | 1.17 | % | $ | 10,316,707 | $ | 27,923 | 1.08 | % | $ | 10,466,131 | $ | 19,623 | 0.74 | % | ||||||||||||||||
Non-interest bearing deposits | 6,418,925 | 6,414,450 | 6,337,955 | |||||||||||||||||||||||||||||||
Other non-interest bearing liabilities | 524,447 | 490,314 | 479,488 | |||||||||||||||||||||||||||||||
Stockholders' equity | 2,954,404 | 2,935,716 | 2,662,281 | |||||||||||||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 19,977,423 | $ | 20,157,187 | $ | 19,945,855 | ||||||||||||||||||||||||||||
Net interest income/interest rate spread (4) | $ | 164,914 | 3.33 | % | $ | 162,198 | 3.29 | % | $ | 163,604 | 3.47 | % | ||||||||||||||||||||||
Taxable equivalent adjustment | 3,066 | 3,129 | 6,657 | |||||||||||||||||||||||||||||||
Net interest income, as reported | $ | 161,848 | $ | 159,069 | $ | 156,947 | ||||||||||||||||||||||||||||
Net interest margin (5) | 3.74 | % | 3.66 | % | 3.60 | % | ||||||||||||||||||||||||||||
Tax equivalent effect | 0.07 | % | 0.07 | % | 0.16 | % | ||||||||||||||||||||||||||||
Net interest margin on a fully tax equivalent basis (5) | 3.81 | % | 3.73 | % | 3.76 | % |
(1) | Non-accrual loans are included in average loans. |
(2) | Interest income includes amortization of deferred loan origination fees and costs. |
(3) | Non-taxable loan and investment income is presented on a fully tax equivalent basis assuming a Federal tax rate of 21% for 2018 and 35% for 2017. |
(4) | Interest rate spread represents the difference between the average yield on interest earning assets and the average cost of interest bearing liabilities and is presented on a fully tax equivalent basis. |
(5) | Net interest margin represents net interest income as a percentage of average interest earning assets. |
Nine Months Ended September 30, | ||||||||||||||||||||||
2018 | 2017 | |||||||||||||||||||||
Average Balance | Interest | Yield/ Rate | Average Balance | Interest | Yield/ Rate | |||||||||||||||||
Interest Earning Assets: | ||||||||||||||||||||||
Loans held for sale | $ | 437,060 | $ | 11,468 | 3.50 | % | $ | 626,000 | $ | 17,118 | 3.65 | % | ||||||||||
Loans (1) (2) (3): | ||||||||||||||||||||||
Commercial-related loans: | ||||||||||||||||||||||
Commercial | 4,809,567 | 179,257 | 4.91 | 4,466,241 | 148,940 | 4.40 | ||||||||||||||||
Commercial loans collateralized by assignment of lease payments (lease loans) | 2,059,510 | 59,865 | 3.88 | 1,995,576 | 55,556 | 3.71 | ||||||||||||||||
Commercial real estate | 4,015,875 | 149,049 | 4.89 | 3,829,792 | 129,206 | 4.45 | ||||||||||||||||
Construction real estate | 482,236 | 17,329 | 4.74 | 502,653 | 15,601 | 4.09 | ||||||||||||||||
Total commercial-related loans | 11,367,188 | 405,500 | 4.71 | 10,794,262 | 349,303 | 4.27 | ||||||||||||||||
Other loans: | ||||||||||||||||||||||
Residential real estate | 1,380,412 | 33,935 | 3.28 | 1,300,819 | 32,131 | 3.29 | ||||||||||||||||
Indirect | 722,572 | 26,115 | 4.83 | 598,788 | 20,575 | 4.59 | ||||||||||||||||
Home equity | 199,381 | 6,945 | 4.66 | 243,712 | 7,492 | 4.11 | ||||||||||||||||
Consumer | 80,850 | 2,483 | 4.11 | 79,755 | 2,447 | 4.10 | ||||||||||||||||
Total other loans | 2,383,215 | 69,478 | 3.89 | 2,223,074 | 62,645 | 3.76 | ||||||||||||||||
Total loans, excluding purchased credit-impaired loans | 13,750,403 | 474,978 | 4.57 | 13,017,336 | 411,948 | 4.19 | ||||||||||||||||
Purchased credit-impaired loans | 104,810 | 11,804 | 15.06 | 152,112 | 16,310 | 14.34 | ||||||||||||||||
Total loans | 13,855,213 | 486,782 | 4.65 | 13,169,448 | 428,258 | 4.30 | ||||||||||||||||
Taxable investment securities | 1,410,815 | 28,879 | 2.73 | 1,525,546 | 26,279 | 2.30 | ||||||||||||||||
Investment securities exempt from federal income taxes (3) | 1,222,992 | 35,825 | 3.91 | 1,265,378 | 45,449 | 4.79 | ||||||||||||||||
Federal funds sold | 241 | 4 | 2.16 | 74 | 1 | 1.41 | ||||||||||||||||
Other interest earning deposits | 211,113 | 2,021 | 1.28 | 121,783 | 753 | 0.83 | ||||||||||||||||
Total interest earning assets | $ | 17,137,434 | $ | 564,979 | 4.37 | % | $ | 16,708,229 | $ | 517,858 | 4.11 | % | ||||||||||
Non-interest earning assets | 2,887,097 | 2,741,325 | ||||||||||||||||||||
Total assets | $ | 20,024,531 | $ | 19,449,554 | ||||||||||||||||||
Interest Bearing Liabilities: | ||||||||||||||||||||||
Core funding: | ||||||||||||||||||||||
Money market, NOW and interest bearing deposits | $ | 4,931,411 | $ | 24,150 | 0.65 | % | $ | 4,592,898 | $ | 10,391 | 0.30 | % | ||||||||||
Savings deposits | 1,196,811 | 2,621 | 0.29 | 1,113,044 | 789 | 0.09 | ||||||||||||||||
Certificates of deposit | 1,384,730 | 11,460 | 1.11 | 1,311,304 | 6,683 | 0.68 | ||||||||||||||||
Customer repurchase agreements | 223,773 | 692 | 0.41 | 193,686 | 311 | 0.21 | ||||||||||||||||
Total core funding | 7,736,725 | 38,923 | 0.67 | 7,210,932 | 18,174 | 0.34 | ||||||||||||||||
Wholesale funding: | ||||||||||||||||||||||
Brokered accounts (includes fee expense) | 1,065,496 | 14,672 | 1.84 | 835,260 | 9,270 | 1.48 | ||||||||||||||||
Other borrowings | 1,391,810 | 27,769 | 2.63 | 2,017,027 | 21,052 | 1.38 | ||||||||||||||||
Total wholesale funding | 2,457,306 | 42,441 | 2.29 | 2,852,287 | 30,322 | 1.41 | ||||||||||||||||
Total interest bearing liabilities | $ | 10,194,031 | $ | 81,364 | 1.06 | % | $ | 10,063,219 | $ | 48,496 | 0.64 | % | ||||||||||
Non-interest bearing deposits | 6,376,069 | 6,294,974 | ||||||||||||||||||||
Other non-interest bearing liabilities | 503,993 | 465,268 | ||||||||||||||||||||
Stockholders' equity | 2,950,438 | 2,626,093 | ||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 20,024,531 | $ | 19,449,554 | ||||||||||||||||||
Net interest income/interest rate spread (4) | $ | 483,615 | 3.31 | % | $ | 469,362 | 3.47 | % | ||||||||||||||
Taxable equivalent adjustment | 9,317 | 20,378 | ||||||||||||||||||||
Net interest income, as reported | $ | 474,298 | $ | 448,984 | ||||||||||||||||||
Net interest margin (5) | 3.66 | % | 3.56 | % | ||||||||||||||||||
Tax equivalent effect | 0.08 | % | 0.16 | % | ||||||||||||||||||
Net interest margin on a fully tax equivalent basis (5) | 3.74 | % | 3.72 | % |
(1) | Non-accrual loans are included in average loans. |
(2) | Interest income includes amortization of deferred loan origination fees and costs. |
(3) | Non-taxable loan and investment income is presented on a fully tax equivalent basis assuming a Federal tax rate of 21% for 2018 and 35% for 2017. |
(4) | Interest rate spread represents the difference between the average yield on interest earning assets and the average cost of interest bearing liabilities and is presented on a fully tax equivalent basis. |
(5) | Net interest margin represents net interest income as a percentage of average interest earning assets. |
3Q18 | 2Q18 | 3Q17 | |||||||||||||||||||||||||||||||
Average Balance | Interest | Yield | Average Balance | Interest | Yield | Average Balance | Interest | Yield | |||||||||||||||||||||||||
Loan yield excluding acquisition accounting discount accretion on bank merger loans: | |||||||||||||||||||||||||||||||||
Total loans, as reported | $ | 13,821,710 | $ | 169,299 | 4.82 | % | $ | 13,839,023 | $ | 161,921 | 4.64 | % | $ | 13,609,653 | $ | 152,838 | 4.42 | % | |||||||||||||||
Less acquisition accounting discount on non-PCI loans | (15,467 | ) | 1,971 | (17,584 | ) | 2,267 | (25,764 | ) | 3,587 | ||||||||||||||||||||||||
Less acquisition accounting discount on PCI loans | (13,315 | ) | 2,579 | (16,098 | ) | 2,223 | (28,347 | ) | 4,315 | ||||||||||||||||||||||||
Total loans, excluding acquisition accounting discount on bank merger loans | $ | 13,850,492 | $ | 164,749 | 4.68 | % | $ | 13,872,705 | $ | 157,431 | 4.50 | % | $ | 13,663,764 | $ | 144,936 | 4.17 | % | |||||||||||||||
Net interest margin on a fully tax equivalent basis, excluding acquisition accounting discount accretion on bank merger loans: | |||||||||||||||||||||||||||||||||
Total interest earning assets, as reported | $ | 17,070,198 | $ | 164,914 | 3.81 | % | $ | 17,274,824 | $ | 162,198 | 3.73 | % | $ | 17,183,299 | $ | 163,604 | 3.76 | % | |||||||||||||||
Less acquisition accounting discount on non-PCI loans | (15,467 | ) | 1,971 | (17,584 | ) | 2,267 | (25,764 | ) | 3,587 | ||||||||||||||||||||||||
Less acquisition accounting discount on PCI loans | (13,315 | ) | 2,579 | (16,098 | ) | 2,223 | (28,347 | ) | 4,315 | ||||||||||||||||||||||||
Total interest earning assets/net interest margin on a fully tax equivalent basis, excluding acquisition accounting discount on bank merger loans | $ | 17,098,980 | $ | 160,364 | 3.70 | % | $ | 17,308,506 | $ | 157,708 | 3.62 | % | $ | 17,237,410 | $ | 155,702 | 3.56 | % |
Nine Months Ended September 30, | ||||||||||||||||||||||
2018 | 2017 | |||||||||||||||||||||
Average Balance | Interest | Yield | Average Balance | Interest | Yield | |||||||||||||||||
Loan yield excluding acquisition accounting discount accretion on bank merger loans: | ||||||||||||||||||||||
Total loans, as reported | $ | 13,855,213 | $ | 486,782 | 4.65 | % | $ | 13,169,448 | $ | 428,258 | 4.30 | % | ||||||||||
Less acquisition accounting discount on non-PCI loans | (17,584 | ) | 6,576 | (30,083 | ) | 12,426 | ||||||||||||||||
Less acquisition accounting discount on PCI loans | (15,822 | ) | 7,213 | (33,843 | ) | 9,334 | ||||||||||||||||
Total loans, excluding acquisition accounting discount on bank merger loans | $ | 13,888,619 | $ | 472,993 | 4.51 | % | $ | 13,233,374 | $ | 406,498 | 4.06 | % | ||||||||||
Net interest margin on a fully tax equivalent basis, excluding acquisition accounting discount accretion on bank merger loans: | ||||||||||||||||||||||
Total interest earning assets, as reported | $ | 17,137,434 | $ | 483,615 | 3.74 | % | $ | 16,708,229 | $ | 469,362 | 3.72 | % | ||||||||||
Less acquisition accounting discount on non-PCI loans | (17,584 | ) | 6,576 | (30,083 | ) | 12,426 | ||||||||||||||||
Less acquisition accounting discount on PCI loans | (15,822 | ) | 7,213 | (33,843 | ) | 9,334 | ||||||||||||||||
Total interest earning assets/net interest margin on a fully tax equivalent basis, excluding acquisition accounting discount on bank merger loans | $ | 17,170,840 | $ | 469,826 | 3.62 | % | $ | 16,772,155 | $ | 447,602 | 3.53 | % |
NON-INTEREST INCOME |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Core non-interest income: | |||||||||||||||||||||||||||||
Key fee initiatives: | |||||||||||||||||||||||||||||
Lease financing revenue, net | $ | 25,205 | $ | 22,918 | $ | 24,710 | $ | 23,620 | $ | 23,148 | $ | 72,833 | $ | 62,967 | |||||||||||||||
Treasury management fees | 15,226 | 15,066 | 15,156 | 15,234 | 14,508 | 45,448 | 43,696 | ||||||||||||||||||||||
Wealth management fees | 9,089 | 8,969 | 9,121 | 9,024 | 8,702 | 27,179 | 25,720 | ||||||||||||||||||||||
Card fees | 5,362 | 5,654 | 4,787 | 5,032 | 4,585 | 15,803 | 13,564 | ||||||||||||||||||||||
Capital markets and international banking fees | 1,913 | 3,785 | 2,998 | 3,999 | 4,870 | 8,696 | 11,709 | ||||||||||||||||||||||
Total key fee initiatives | 56,795 | 56,392 | 56,772 | 56,909 | 55,813 | 169,959 | 157,656 | ||||||||||||||||||||||
Mortgage banking revenue | 9,916 | 18,926 | 25,047 | 22,374 | 28,242 | 53,889 | 86,850 | ||||||||||||||||||||||
Consumer and other deposit service fees | 3,051 | 2,929 | 2,912 | 3,261 | 3,424 | 8,892 | 10,072 | ||||||||||||||||||||||
Brokerage fees | 1,138 | 1,050 | 864 | 942 | 1,004 | 3,052 | 3,379 | ||||||||||||||||||||||
Loan service fees | 2,103 | 2,148 | 2,245 | 2,197 | 2,114 | 6,496 | 6,120 | ||||||||||||||||||||||
Increase in cash surrender value of life insurance | 1,298 | 1,272 | 1,108 | 1,511 | 1,321 | 3,678 | 3,910 | ||||||||||||||||||||||
Other operating income | 4,714 | 5,610 | 4,445 | 2,616 | 3,104 | 14,769 | 8,296 | ||||||||||||||||||||||
Total core non-interest income | 79,015 | 88,327 | 93,393 | 89,810 | 95,022 | 260,735 | 276,283 | ||||||||||||||||||||||
Non-core non-interest income: | |||||||||||||||||||||||||||||
Net (loss) gain on investment securities | (85 | ) | (86 | ) | (174 | ) | 111 | 83 | (345 | ) | 451 | ||||||||||||||||||
Net loss on disposal of other assets | (32 | ) | (397 | ) | (357 | ) | (2,016 | ) | (180 | ) | (786 | ) | (307 | ) | |||||||||||||||
Recovery of low to moderate income real estate investment (1) | — | — | — | 1,006 | 210 | — | 698 | ||||||||||||||||||||||
Increase (decrease) in market value of assets held in trust for deferred compensation (1) | 943 | 462 | (60 | ) | 912 | 796 | 1,345 | 2,426 | |||||||||||||||||||||
Total non-core non-interest income | 826 | (21 | ) | (591 | ) | 13 | 909 | 214 | 3,268 | ||||||||||||||||||||
Total non-interest income | $ | 79,841 | $ | 88,306 | $ | 92,802 | $ | 89,823 | $ | 95,931 | $ | 260,949 | $ | 279,551 |
(1) | Resides in other operating income in the consolidated statements of operations. |
NON-INTEREST EXPENSE |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Core non-interest expense: (1) | |||||||||||||||||||||||||||||
Salaries and employee benefits expense: | |||||||||||||||||||||||||||||
Salaries | $ | 56,234 | $ | 63,157 | $ | 64,587 | $ | 62,465 | $ | 61,992 | $ | 183,978 | $ | 180,692 | |||||||||||||||
Commissions | 4,948 | 7,623 | 7,435 | 8,303 | 9,206 | 20,006 | 27,547 | ||||||||||||||||||||||
Bonus and stock-based compensation | 12,373 | 12,853 | 12,055 | 13,332 | 11,911 | 37,281 | 36,754 | ||||||||||||||||||||||
Other salaries and benefits (2) | 20,826 | 21,873 | 21,940 | 20,153 | 20,922 | 64,639 | 60,359 | ||||||||||||||||||||||
Total salaries and employee benefits expense | 94,381 | 105,506 | 106,017 | 104,253 | 104,031 | 305,904 | 305,352 | ||||||||||||||||||||||
Occupancy and equipment expense | 15,801 | 16,450 | 17,394 | 16,727 | 15,382 | 49,645 | 45,700 | ||||||||||||||||||||||
Computer services and telecommunication expense | 10,036 | 10,871 | 11,156 | 11,287 | 10,093 | 32,063 | 29,057 | ||||||||||||||||||||||
Advertising and marketing expense | 3,154 | 3,342 | 3,837 | 3,266 | 2,558 | 10,333 | 8,964 | ||||||||||||||||||||||
Professional and legal expense | 1,874 | 5,434 | 1,894 | 2,914 | 2,109 | 9,202 | 7,150 | ||||||||||||||||||||||
Other intangible amortization expense | 1,854 | 1,896 | 1,902 | 1,979 | 2,038 | 5,652 | 6,214 | ||||||||||||||||||||||
Net loss (gain) recognized on other real estate owned (A) | 62 | 879 | (143 | ) | (151 | ) | 84 | 798 | 1,397 | ||||||||||||||||||||
Other real estate expense, net (A) | 186 | 169 | 190 | 47 | (170 | ) | 545 | 51 | |||||||||||||||||||||
Other operating expenses | 20,071 | 23,039 | 21,919 | 23,450 | 22,702 | 65,029 | 68,442 | ||||||||||||||||||||||
Total core non-interest expense | 147,419 | 167,586 | 164,166 | 163,772 | 158,827 | 479,171 | 472,327 | ||||||||||||||||||||||
Non-core non-interest expense: (1) | |||||||||||||||||||||||||||||
Merger related and repositioning expenses (B) | 13,927 | 24,944 | 644 | 944 | 1,579 | 39,515 | 9,003 | ||||||||||||||||||||||
One-time bonuses | — | — | — | 2,700 | — | — | — | ||||||||||||||||||||||
Branch exit and facilities impairment charges | — | — | — | — | 1,759 | — | 1,759 | ||||||||||||||||||||||
Loss on extinguishment of debt (3) | 6,255 | — | 3,136 | — | — | 9,391 | — | ||||||||||||||||||||||
Contribution to MB Financial Charitable Foundation (C) | — | — | — | 7,500 | — | — | — | ||||||||||||||||||||||
Increase (decrease) in market value of assets held in trust for deferred compensation (D) | 943 | 462 | (60 | ) | 912 | 796 | 1,345 | 2,426 | |||||||||||||||||||||
Total non-core non-interest expense | 21,125 | 25,406 | 3,720 | 12,056 | 4,134 | 50,251 | 13,188 | ||||||||||||||||||||||
Total non-interest expense | $ | 168,544 | $ | 192,992 | $ | 167,886 | $ | 175,828 | $ | 162,961 | $ | 529,422 | $ | 485,515 |
(1) | Letters denote the corresponding line items where these items reside in the consolidated statements of operations as follows: A – Net loss (gain) recognized on other real estate owned and other related expense, B – See merger related and repositioning expenses table below, C – Other operating expenses, and D – Salaries and employee benefits. |
(2) | Includes health insurance, payroll taxes, 401(k) and profit sharing contributions, overtime, and temporary help expenses. |
(3) | Includes losses on the extinguishment of junior subordinated notes issued to capital trusts in the first and third quarters of 2018. |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Merger related and repositioning expenses (1): | |||||||||||||||||||||||||||||
Salaries and employee benefits expense | $ | 6,561 | $ | 17,510 | $ | 557 | $ | 1,382 | $ | 988 | $ | 24,628 | $ | 2,154 | |||||||||||||||
Occupancy and equipment expense | 316 | 1 | 35 | 119 | — | 352 | 10 | ||||||||||||||||||||||
Computer services and telecommunication expense | 2,648 | — | — | 17 | (31 | ) | 2,648 | 230 | |||||||||||||||||||||
Advertising and marketing expense | 278 | — | 26 | 5 | — | 304 | — | ||||||||||||||||||||||
Professional and legal expense | 712 | 3,453 | 4 | 43 | — | 4,169 | 100 | ||||||||||||||||||||||
Branch exit and facilities impairment charges (2) | 3,292 | 340 | — | (327 | ) | 1,014 | 3,632 | 6,921 | |||||||||||||||||||||
Contingent consideration expense (3) | — | — | — | (454 | ) | — | — | — | |||||||||||||||||||||
Goodwill impairment loss (4) | — | 3,623 | — | — | — | 3,623 | — | ||||||||||||||||||||||
Other operating expenses | 120 | 17 | 22 | 159 | (392 | ) | 159 | (412 | ) | ||||||||||||||||||||
Total merger related and repositioning expenses | $ | 13,927 | $ | 24,944 | $ | 644 | $ | 944 | $ | 1,579 | $ | 39,515 | $ | 9,003 |
(1) | Includes costs incurred in connection with the pending merger with Fifth Third, the discontinuation of our national mortgage origination business, the mortgage banking acquisition (completed in the fourth quarter of 2017), and the American Chartered merger (completed in 2016). For the third quarter of 2018, approximately $10 million relates to the discontinuation of our national mortgage origination business and approximately $4 million relates to the pending merger with Fifth Third. For the second quarter of 2018, approximately $19 million relates to the discontinuation of our national mortgage origination business and approximately $6 million relates to the pending merger with Fifth Third. |
(2) | Includes the following items: exit charges related to the closing of 34 of our mortgage retail offices in the third quarter of 2018; exit charges related to the closing of five of our mortgage retail offices in the second quarter of 2018; gains on previously closed branch facilities in the fourth quarter of 2017; costs associated with office space reconfiguration in the third quarter of 2017; and exit charges on branches closed in the second quarter of 2017 due to the American Chartered merger. |
(3) | Includes an increase in our contingent consideration accrual for our acquisition of Celtic Leasing Corp. as a result of stronger lease residual performance than previously estimated. Also includes a decrease in our contingent consideration accrual for our acquisition of MSA Holdings, LLC. Resides in other operating expenses in the consolidated statements of operations. |
(4) | Reflects the goodwill impairment charge at the Mortgage Banking Segment in the second quarter of 2018. |
INCOME TAX EXPENSE |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Income before income taxes - as reported | $ | 51,642 | $ | 48,164 | $ | 70,789 | $ | 63,745 | $ | 85,400 | $ | 170,595 | $ | 225,070 | |||||||||||||||
Tax at Federal statutory rate (21% for 2018 and 35% for 2017) | 10,845 | 10,114 | 14,866 | 22,310 | 29,890 | 35,825 | 78,775 | ||||||||||||||||||||||
Increase (decrease) due to: | |||||||||||||||||||||||||||||
Tax exempt income, net | (2,653 | ) | (2,681 | ) | (2,639 | ) | (4,673 | ) | (4,665 | ) | (7,973 | ) | (14,379 | ) | |||||||||||||||
State tax expense (benefit), net of Federal impact | 2,846 | 2,593 | 3,964 | 3,103 | 4,101 | 9,403 | 9,592 | ||||||||||||||||||||||
Other items, net | 198 | 931 | 586 | 1,131 | (802 | ) | 1,715 | 266 | |||||||||||||||||||||
Tax expense before discrete items | 11,236 | 10,957 | 16,777 | 21,871 | 28,524 | 38,970 | 74,254 | ||||||||||||||||||||||
Income tax rate before discrete items (effective tax rate) | 21.8 | % | 22.7 | % | 23.7 | % | 34.3 | % | 33.4 | % | 22.8 | % | 33.0 | % | |||||||||||||||
Discrete tax expense (benefit) items (1) | (154 | ) | (483 | ) | (201 | ) | 1,919 | (1,643 | ) | (838 | ) | (4,602 | ) | ||||||||||||||||
Discrete tax benefit corporate Federal tax rate changes (2) | (2,154 | ) | (843 | ) | (2,544 | ) | (104,239 | ) | — | (5,541 | ) | — | |||||||||||||||||
Discrete tax benefit corporate state tax rate changes (3) | — | — | — | — | (2,324 | ) | — | (2,324 | ) | ||||||||||||||||||||
Discrete tax expense (benefit) merger related items (4) | — | — | — | — | — | — | (2,104 | ) | |||||||||||||||||||||
Income tax expense - as reported | $ | 8,928 | $ | 9,631 | $ | 14,032 | $ | (80,449 | ) | $ | 24,557 | $ | 32,591 | $ | 65,224 | ||||||||||||||
Income tax rate | 17.3 | % | 20.0 | % | 19.8 | % | (126.2 | )% | 28.8 | % | 19.1 | % | 29.0 | % |
(1) | Includes tax benefits on the vesting of restricted shares, exercise of options, and other compensation as well as non-deductible merger expenses and the $2.1 million increase in state income tax accruals due to income allocation to high income tax rate jurisdictions for the fourth quarter of 2017. |
(2) | Includes the impact of the Federal income tax rate decrease due to the TCJ Act (enacted on December 22, 2017) on our net deferred tax liabilities. |
(3) | Includes tax benefit due to the impact of the Illinois state income tax rate increase (effective July 1, 2017) on our deferred tax assets. |
(4) | Includes reversals of a tax liability no longer needed specifically related to two entities we acquired and certain non-deductible merger related items. |
NON-GAAP FINANCIAL INFORMATION |
9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | ||||||||||||||||
Stockholders' equity - as reported | $ | 2,965,329 | $ | 2,948,693 | $ | 2,934,347 | $ | 3,009,823 | $ | 2,692,092 | ||||||||||
Less goodwill | 999,925 | 999,925 | 1,003,548 | 1,003,548 | 999,925 | |||||||||||||||
Less other intangible assets, net of tax benefit | 35,976 | 37,334 | 38,723 | 40,116 | 36,884 | |||||||||||||||
Tangible equity | $ | 1,929,428 | $ | 1,911,434 | $ | 1,892,076 | $ | 1,966,159 | $ | 1,655,283 |
9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | ||||||||||||||||
Total assets - as reported | $ | 19,719,971 | $ | 19,966,557 | $ | 20,167,523 | $ | 20,086,940 | $ | 20,116,535 | ||||||||||
Less goodwill | 999,925 | 999,925 | 1,003,548 | 1,003,548 | 999,925 | |||||||||||||||
Less other intangible assets, net of tax benefit | 35,976 | 37,334 | 38,723 | 40,116 | 36,884 | |||||||||||||||
Tangible assets | $ | 18,684,070 | $ | 18,929,298 | $ | 19,125,252 | $ | 19,043,276 | $ | 19,079,726 |
9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | ||||||||||||||||
Common stockholders' equity - as reported | $ | 2,770,610 | $ | 2,753,974 | $ | 2,739,628 | $ | 2,699,824 | $ | 2,576,812 | ||||||||||
Less goodwill | 999,925 | 999,925 | 1,003,548 | 1,003,548 | 999,925 | |||||||||||||||
Less other intangible assets, net of tax benefit | 35,976 | 37,334 | 38,723 | 40,116 | 36,884 | |||||||||||||||
Tangible common equity | $ | 1,734,709 | $ | 1,716,715 | $ | 1,697,357 | $ | 1,656,160 | $ | 1,540,003 |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Average common stockholders' equity - as reported | $ | 2,759,685 | $ | 2,740,997 | $ | 2,708,911 | $ | 2,579,896 | $ | 2,546,744 | $ | 2,736,717 | $ | 2,510,533 | |||||||||||||||
Less average goodwill | 999,925 | 1,001,119 | 1,003,548 | 1,001,027 | 999,925 | 1,001,517 | 1,000,281 | ||||||||||||||||||||||
Less average other intangible assets, net of tax benefit | 36,433 | 37,804 | 39,212 | 36,049 | 37,346 | 37,807 | 38,734 | ||||||||||||||||||||||
Average tangible common equity | $ | 1,723,327 | $ | 1,702,074 | $ | 1,666,151 | $ | 1,542,820 | $ | 1,509,473 | $ | 1,697,393 | $ | 1,471,518 |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Net income available to common stockholders - as reported | $ | 39,714 | $ | 35,533 | $ | 68,937 | $ | 142,194 | $ | 58,841 | $ | 144,184 | $ | 153,839 | |||||||||||||||
Plus other intangible amortization expense, net of tax benefit | 1,358 | 1,389 | 1,393 | 1,286 | 1,325 | 4,140 | 4,039 | ||||||||||||||||||||||
Net cash flow available to common stockholders | $ | 41,072 | $ | 36,922 | $ | 70,330 | $ | 143,480 | $ | 60,166 | $ | 148,324 | $ | 157,878 |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Net income - as reported | $ | 42,714 | $ | 38,533 | $ | 56,757 | $ | 144,194 | $ | 60,843 | $ | 138,004 | $ | 159,846 | |||||||||||||||
Less non-core items: | |||||||||||||||||||||||||||||
Net (loss) gain on investment securities | (85 | ) | (86 | ) | (174 | ) | 111 | 83 | (345 | ) | 451 | ||||||||||||||||||
Net loss on disposal of other assets | (32 | ) | (397 | ) | (357 | ) | (2,016 | ) | (180 | ) | (786 | ) | (307 | ) | |||||||||||||||
Recovery of low to moderate income real estate investment | — | — | — | 1,006 | 210 | — | 698 | ||||||||||||||||||||||
Increase (decrease) in market value of assets held in trust for deferred compensation - other operating income | 943 | 462 | (60 | ) | 912 | 796 | 1,345 | 2,426 | |||||||||||||||||||||
Merger related and repositioning expenses | (13,927 | ) | (24,944 | ) | (644 | ) | (944 | ) | (1,579 | ) | (39,515 | ) | (9,003 | ) | |||||||||||||||
One-time bonuses | — | — | — | (2,700 | ) | — | — | — | |||||||||||||||||||||
Branch exit and facilities impairment charges | — | — | — | — | (1,759 | ) | — | (1,759 | ) | ||||||||||||||||||||
Loss on extinguishment of debt | (6,255 | ) | — | (3,136 | ) | — | — | (9,391 | ) | — | |||||||||||||||||||
Contribution to MB Financial Charitable Foundation | — | — | — | (7,500 | ) | — | — | — | |||||||||||||||||||||
(Increase) decrease in market value of assets held in trust for deferred compensation - other operating expense | (943 | ) | (462 | ) | 60 | (912 | ) | (796 | ) | (1,345 | ) | (2,426 | ) | ||||||||||||||||
Total non-core items | (20,299 | ) | (25,427 | ) | (4,311 | ) | (12,043 | ) | (3,225 | ) | (50,037 | ) | (9,920 | ) | |||||||||||||||
Income tax expense on non-core items | (5,256 | ) | (5,905 | ) | (1,153 | ) | (4,618 | ) | (1,283 | ) | (12,314 | ) | (3,940 | ) | |||||||||||||||
Income tax expense - other (1) | (2,154 | ) | (843 | ) | (2,544 | ) | (104,239 | ) | — | (5,541 | ) | (2,104 | ) | ||||||||||||||||
Non-core items, net of tax | (12,889 | ) | (18,679 | ) | (614 | ) | 96,814 | (1,942 | ) | (32,182 | ) | (3,876 | ) | ||||||||||||||||
Operating earnings | 55,603 | 57,212 | 57,371 | 47,380 | 62,785 | 170,186 | 163,722 | ||||||||||||||||||||||
Operating earnings (loss) - Mortgage Banking Segment | 1,067 | (3,359 | ) | (295 | ) | (815 | ) | 2,217 | (2,587 | ) | 6,309 | ||||||||||||||||||
Operating earnings, excluding Mortgage Banking Segment | 54,536 | 60,571 | 57,666 | 48,195 | 60,568 | 172,773 | 157,413 | ||||||||||||||||||||||
Dividends on preferred shares | 3,000 | 3,000 | 3,100 | 2,000 | 2,002 | 9,100 | 6,007 | ||||||||||||||||||||||
Operating earnings, excluding Mortgage Banking Segment, available to common stockholders | $ | 51,536 | $ | 57,571 | $ | 54,566 | $ | 46,195 | $ | 58,566 | $ | 163,673 | $ | 151,406 | |||||||||||||||
Diluted earnings per common share - as reported | $ | 0.47 | $ | 0.42 | $ | 0.81 | $ | 1.67 | $ | 0.69 | $ | 1.69 | $ | 1.81 | |||||||||||||||
Impact of return from preferred stockholders due to redemption | — | — | (0.18 | ) | — | — | (0.18 | ) | — | ||||||||||||||||||||
Impact of non-core items, net of tax | 0.14 | 0.22 | 0.01 | (1.14 | ) | 0.03 | 0.38 | 0.05 | |||||||||||||||||||||
Impact of excluding operating (loss) earnings - Mortgage Banking Segment | (0.01 | ) | 0.04 | — | 0.01 | (0.03 | ) | 0.03 | (0.07 | ) | |||||||||||||||||||
Diluted operating earnings per common share, excluding Mortgage Banking Segment | $ | 0.60 | $ | 0.68 | $ | 0.64 | $ | 0.54 | $ | 0.69 | $ | 1.92 | $ | 1.79 | |||||||||||||||
Weighted average common shares outstanding for diluted operating earnings per common share | 85,335,109 | 85,251,810 | 84,896,401 | 84,964,759 | 84,779,797 | 85,162,220 | 84,775,952 |
(1) | The first three quarters of 2018 and fourth quarter of 2017 include the reversal of deferred tax liabilities as a result of the decrease in Federal income tax rate effective January 1, 2018 due to the TCJ Act. The third quarter of 2018 reversal of $2.2 million was recognized at the Banking Segment. The second quarter of 2018 reversal of $843 thousand was recognized as follows: $429 thousand of expense at the Banking Segment and $1.3 million reversal at the Leasing Segment. The first quarter 2018 reversal of $2.5 million was recognized at the Leasing Segment. The fourth quarter 2017 reversal of $104.2 million was recognized as follows: $6.5 million at our Banking Segment, $65.3 million at our Leasing Segment, and $32.4 million |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Banking Segment: | |||||||||||||||||||||||||||||
Net income - as reported | $ | 41,662 | $ | 47,893 | $ | 46,550 | $ | 43,435 | $ | 52,584 | $ | 136,105 | $ | 137,437 | |||||||||||||||
Non-core items, net of tax | 5,738 | 5,714 | 2,550 | 298 | 1,942 | 14,002 | 3,876 | ||||||||||||||||||||||
Operating earnings | $ | 47,400 | $ | 53,607 | $ | 49,100 | $ | 43,733 | $ | 54,526 | $ | 150,107 | $ | 141,313 | |||||||||||||||
Leasing Segment: | |||||||||||||||||||||||||||||
Net income - as reported | $ | 7,136 | $ | 8,236 | $ | 11,110 | $ | 69,783 | $ | 6,042 | $ | 26,482 | $ | 16,100 | |||||||||||||||
Non-core items, net of tax | — | (1,272 | ) | (2,544 | ) | (65,321 | ) | — | (3,816 | ) | — | ||||||||||||||||||
Operating earnings | $ | 7,136 | $ | 6,964 | $ | 8,566 | $ | 4,462 | $ | 6,042 | $ | 22,666 | $ | 16,100 | |||||||||||||||
Mortgage Banking Segment: | |||||||||||||||||||||||||||||
Net (loss) income - as reported | $ | (6,084 | ) | $ | (17,596 | ) | $ | (903 | ) | $ | 30,976 | $ | 2,217 | $ | (24,583 | ) | $ | 6,309 | |||||||||||
Non-core items, net of tax | 7,151 | 14,237 | 608 | (31,791 | ) | — | 21,996 | — | |||||||||||||||||||||
Operating earnings (loss) | $ | 1,067 | $ | (3,359 | ) | $ | (295 | ) | $ | (815 | ) | $ | 2,217 | $ | (2,587 | ) | $ | 6,309 |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Non-interest expense | $ | 168,544 | $ | 192,992 | $ | 167,886 | $ | 175,828 | $ | 162,961 | $ | 529,422 | $ | 485,515 | |||||||||||||||
Less merger related and repositioning expenses | 13,927 | 24,944 | 644 | 944 | 1,579 | 39,515 | 9,003 | ||||||||||||||||||||||
Less loss on extinguishment of debt | 6,255 | — | 3,136 | — | — | 9,391 | — | ||||||||||||||||||||||
Less one-time bonuses | — | — | — | 2,700 | — | — | — | ||||||||||||||||||||||
Less branch exit and facilities impairment charges | — | — | — | — | 1,759 | — | 1,759 | ||||||||||||||||||||||
Less contribution to MB Financial Charitable Foundation | — | — | — | 7,500 | — | — | — | ||||||||||||||||||||||
Less (decrease) increase in market value of assets held in trust for deferred compensation | 943 | 462 | (60 | ) | 912 | 796 | 1,345 | 2,426 | |||||||||||||||||||||
Non-interest expense - as adjusted | $ | 147,419 | $ | 167,586 | $ | 164,166 | $ | 163,772 | $ | 158,827 | $ | 479,171 | $ | 472,327 | |||||||||||||||
Net interest income | $ | 161,848 | $ | 159,069 | $ | 153,381 | $ | 153,393 | $ | 156,947 | $ | 474,298 | $ | 448,984 | |||||||||||||||
Tax equivalent adjustment | 3,066 | 3,129 | 3,122 | 6,483 | 6,657 | 9,317 | 20,378 | ||||||||||||||||||||||
Net interest income on a fully tax equivalent basis | 164,914 | 162,198 | 156,503 | 159,876 | 163,604 | 483,615 | 469,362 | ||||||||||||||||||||||
Plus non-interest income | 79,841 | 88,306 | 92,802 | 89,823 | 95,931 | 260,949 | 279,551 | ||||||||||||||||||||||
Plus tax equivalent adjustment on the increase in cash surrender value of life insurance | 345 | 338 | 295 | 814 | 711 | 978 | 2,105 | ||||||||||||||||||||||
Less net (loss) gain on investment securities | (85 | ) | (86 | ) | (174 | ) | 111 | 83 | (345 | ) | 451 | ||||||||||||||||||
Less net loss on disposal of other assets | (32 | ) | (397 | ) | (357 | ) | (2,016 | ) | (180 | ) | (786 | ) | (307 | ) | |||||||||||||||
Less recovery of low to moderate income real estate investment | — | — | — | 1,006 | 210 | — | 698 | ||||||||||||||||||||||
Less (decrease) increase in market value of assets held in trust for deferred compensation | 943 | 462 | (60 | ) | 912 | 796 | 1,345 | 2,426 | |||||||||||||||||||||
Non-interest income - as adjusted | 79,360 | 88,665 | 93,688 | 90,624 | 95,733 | 261,713 | 278,388 | ||||||||||||||||||||||
Total revenue - as adjusted and on a fully tax equivalent basis | $ | 244,274 | $ | 250,863 | $ | 250,191 | $ | 250,500 | $ | 259,337 | $ | 745,328 | $ | 747,750 | |||||||||||||||
Efficiency ratio | 60.35 | % | 66.80 | % | 65.62 | % | 65.38 | % | 61.24 | % | 64.29 | % | 63.17 | % | |||||||||||||||
Efficiency ratio (without adjustments) | 69.74 | % | 78.02 | % | 68.20 | % | 72.29 | % | 64.44 | % | 72.01 | % | 66.64 | % |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Non-interest expense - as adjusted (1) | $ | 147,419 | $ | 167,586 | $ | 164,166 | $ | 163,772 | $ | 158,827 | $ | 479,171 | $ | 472,327 | |||||||||||||||
Less Mortgage Banking Segment non-interest expense | 16,183 | 33,611 | 35,928 | 34,397 | 35,449 | 85,722 | 106,515 | ||||||||||||||||||||||
Non-interest expense - as adjusted, less Mortgage Banking Segment | $ | 131,236 | $ | 133,975 | $ | 128,238 | $ | 129,375 | $ | 123,378 | $ | 393,449 | $ | 365,812 | |||||||||||||||
Total revenue - as adjusted and on a fully tax equivalent basis (1) | $ | 244,274 | $ | 250,863 | $ | 250,191 | $ | 250,500 | $ | 259,337 | $ | 745,328 | $ | 747,750 | |||||||||||||||
Less Mortgage Banking Segment net interest income | 7,685 | 10,106 | 10,428 | 10,611 | 11,373 | 28,219 | 31,365 | ||||||||||||||||||||||
Less Mortgage Banking Segment non-interest income | 9,929 | 18,937 | 25,048 | 22,374 | 28,243 | 53,914 | 86,851 | ||||||||||||||||||||||
Net interest income plus non-interest income - as adjusted, less Mortgage Banking Segment | $ | 226,660 | $ | 221,820 | $ | 214,715 | $ | 217,515 | $ | 219,721 | $ | 663,195 | $ | 629,534 | |||||||||||||||
Efficiency ratio, excluding Mortgage Banking Segment | 57.90 | % | 60.40 | % | 59.72 | % | 59.48 | % | 56.15 | % | 59.33 | % | 58.11 | % |
(1) | See "Efficiency Ratio Calculation" table for reconciliation of this item. |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Non-interest expense - as adjusted (1) | $ | 147,419 | $ | 167,586 | $ | 164,166 | $ | 163,772 | $ | 158,827 | $ | 479,171 | $ | 472,327 | |||||||||||||||
Less non-interest income - as adjusted (1) | 79,360 | 88,665 | 93,688 | 90,624 | 95,733 | 261,713 | 278,388 | ||||||||||||||||||||||
Net non-interest expense - as adjusted | $ | 68,059 | $ | 78,921 | $ | 70,478 | $ | 73,148 | $ | 63,094 | $ | 217,458 | $ | 193,939 | |||||||||||||||
Average assets | $ | 19,977,423 | $ | 20,157,187 | $ | 19,938,557 | $ | 20,166,673 | $ | 19,945,855 | $ | 20,024,531 | $ | 19,449,554 | |||||||||||||||
Annualized net non-interest expense to average assets | 1.35 | % | 1.57 | % | 1.43 | % | 1.44 | % | 1.25 | % | 1.45 | % | 1.33 | % | |||||||||||||||
Annualized net non-interest expense to average assets (without adjustments) | 1.76 | % | 2.08 | % | 1.53 | % | 1.69 | % | 1.33 | % | 1.79 | % | 1.42 | % |
(1) | See "Efficiency Ratio Calculation" table for reconciliation of this item. |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Non-interest income - as adjusted (1) | $ | 79,360 | $ | 88,665 | $ | 93,688 | $ | 90,624 | $ | 95,733 | $ | 261,713 | $ | 278,388 | |||||||||||||||
Total revenue - as adjusted and on a fully tax equivalent basis (1) | $ | 244,274 | $ | 250,863 | $ | 250,191 | $ | 250,500 | $ | 259,337 | $ | 745,328 | $ | 747,750 | |||||||||||||||
Core non-interest income to revenues ratio | 32.49 | % | 35.34 | % | 37.45 | % | 36.18 | % | 36.91 | % | 35.11 | % | 37.23 | % | |||||||||||||||
Non-interest income to revenues ratio (without adjustments) | 33.03 | % | 35.70 | % | 37.70 | % | 36.93 | % | 37.94 | % | 35.49 | % | 38.37 | % |
(1) | See "Efficiency Ratio Calculation" table for reconciliation of this item. |
Nine Months Ended | |||||||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||||||
3Q18 | 2Q18 | 1Q18 | 4Q17 | 3Q17 | 2018 | 2017 | |||||||||||||||||||||||
Non-interest income - as adjusted (1) | $ | 79,360 | $ | 88,665 | $ | 93,688 | $ | 90,624 | $ | 95,733 | $ | 261,713 | $ | 278,388 | |||||||||||||||
Less Mortgage Banking Segment non-interest income | 9,929 | 18,937 | 25,048 | 22,374 | 28,243 | 53,914 | 86,851 | ||||||||||||||||||||||
Non-interest income - as adjusted, less Mortgage Banking Segment | $ | 69,431 | $ | 69,728 | $ | 68,640 | $ | 68,250 | $ | 67,490 | $ | 207,799 | $ | 191,537 | |||||||||||||||
Total revenue - as adjusted and on a fully tax equivalent basis (1) | $ | 244,274 | $ | 250,863 | $ | 250,191 | $ | 250,500 | $ | 259,337 | $ | 745,328 | $ | 747,750 | |||||||||||||||
Less Mortgage Banking Segment net interest income | 7,685 | 10,106 | 10,428 | 10,611 | 11,373 | 28,219 | 31,365 | ||||||||||||||||||||||
Less Mortgage Banking Segment non-interest income | 9,929 | 18,937 | 25,048 | 22,374 | 28,243 | 53,914 | 86,851 | ||||||||||||||||||||||
Total revenue - as adjusted and on a fully tax equivalent basis, less Mortgage Banking Segment | $ | 226,660 | $ | 221,820 | $ | 214,715 | $ | 217,515 | $ | 219,721 | $ | 663,195 | $ | 629,534 | |||||||||||||||
Core non-interest income to revenues ratio, excluding Mortgage Banking Segment | 30.63 | % | 31.43 | % | 31.97 | % | 31.38 | % | 30.72 | % | 31.33 | % | 30.43 | % |
(1) | See "Efficiency Ratio Calculation" table for reconciliation of this item. |
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